but this outflow was not ample to have an effect on the rates due to which at the same rates SBP accepted Rs. 7.10 billion in four weeks in its second OMO. After the total outflow of around Rs. 17.00 billion from the market rates comparatively hiked up and activity in overnight took place in the band of 3.50% and 4.00%. It was on Thursday, the day of T-bill auction settlement that rates took a U-turn and hiked across the board. After the T-bill auction in which SBP accepted Rs. 27.150 billion, funds in overnight changed hand just below the discount rate at 8.95% and banks had to approached SBP for respite due to which discounting of around Rs. 2.80 billion was reported.

In term repo side volatility was witnessed primarily as deals in one and two weeks were struck around 3.50% and 4.00% but after the T-bill auction activity in the respected tenor was witnessed as high as 7.00% and 6.50%. One month after changing hands around 5.50% witnessed a hike of around 70 to 75 basis points. No major activity in long term was observed and some stray deals in three months were seen at around 5.75%. Bids and offers for six months were in the band of 5.90% and 6.20%. This week State Bank conducted its T-bill auction and heavy participation of Rs. 74.80 billion took place against the targeted amount of Rs. 16.00 billion.

In response of this aggressive participation Central Bank accepted Rs. 27.150 billion in six months at the cut-off yield of 6.3946% and rejected rest of the bids. Aggressive buying was evident in longer tenors T-bills and trades in latest one year was struck at 6.45% and bid and offers for near eight months to maturity paper was quoted in the band of 6.25% and 6.15%.

YIELD PROFILE
FEDERAL INVESTMENT BONDS
.	THIS WEEK	1 WEEK AGO	1 YEAR AGO
1 Year	06.50	06.65	11.00%
2 Year	07.00	07.20	11.50%
3 Year	07.25	07.50	12.00%
4 Year	08.00	08.00	12.00%
5 Year	08.30	08.28	12.50%
10 Year	09.35	09.45	13.00%

 

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AUCTIONS
BID DATE	INSTRUMENT		RESULT		SETTLEMENT
Sep 18	T-BILL		Sep 18		Sep 19
TARGET AMOUNT		BID AMOUNT		ACCEPTED AMOUNT
Rs.16,000 Mln		Rs.74,975 Mln		Rs.27,150 Mln

 

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MATURITIES
INSTRUMENT	DATE	AMOUNT
T-Bill	05 Sep	5,800 Mln.
T-Bill	19 Sep	16,181 Mln.

 

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REPO RATES
	THIS WEEK	1 WEEK AGO	1 YEAR AGO
Overnight	08.25	01.00	11.90
1 Week	07.38	02.75	10.75
1 Month	06.13	04.80	10.50
3 Month	05.88	05.60	10.20
6 Month	05.98	05.90	10.50
1 Year	06.50	06.40	10.70

 

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TREASURY BILL RATES
MATURING	THIS WEEK	1 WEEK AGO	1 YEAR AGO
1 Month	06.65	05.10	11.50
2 Month	06.10	05.40	10.35
3 Month	06.00	05.60	10.20
4 Month	06.00	05.75	10.30
5 Month	06.05	05.85	10.40

 

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