FINEX WEEK

 

 

By SHABBIR H. KAZMI
Updated Dec 14, 2002

 

Interest rates continued to ease off in the interbank market. Both primary and secondary market yields on T-Bills were on the slide with the same trend being witnessed on the long term bonds as well. The short term market did rise but only after the outflow on account of the T-Bill auction the past week with banks having to approach SBP for respite.

The overnight market initially at levels of 4.50% and 5.50% soon moved upwards as the auction drew near. The acceptance of Rs. 13.25 billion for the six month T-Bill resulted in the change in the sentiment of the market. Overnight rates shot up and touched the 7.40% level. This was the first time that the market fell short of liquidity and touched the new discount rate of 7.50%. A total of Rs. 6.60 billion of discounting was conducted on the settlement date of the auction. It was desperate covering in the shorter tenors of one and two week at 6.00% and 7.00% that saw one month rates jump up an cross 5.00% after remaining at around 4.50% for the last two weeks. However this sudden hike in rates was only temporary and activity in two week and one month was witnessed at pre-auction levels of 4.00%. A total participation of Rs. 41.825 billion was witnessed for the 6 month paper out of which Rs. Rs. 13.25 billion was accepted at a new cut-off 4 45%. This 40 basis points cut did not come much as surprise was most in the market but desperate buying caused this paper to soon trade as low as 4.05%. Desperate buying was also evident for the ten year paper that traded at yet again record levels of 6.33% i.e. prices of 134.

YIELD PROFILE

FEDERAL INVESTMENT BONDS

.

THIS WEEK

1 WEEK AGO

1 YEAR AGO

1 Year

04.45

04.70

08.65%

2 Year

04.85

05.30

09.35%

3 Year

05.10

05.70

10.75%

4 Year

05.50

05.70

11.00%

5 Year

05.50

05.90

11.25%

10 Year

06.35

06.95

12.25%

 


 

AUCTIONS

BID DATE

INSTRUMENT

RESULT

SETTLEMENT

Dec 11 T-BILL Dec 11 Dec 12

TARGET AMOUNT

BID AMOUNT

ACCEPTED AMOUNT

Rs.10,000 Mln 

Rs.41,825 Mln 

Rs.13,250 Mln

 


 

MATURITIES

INSTRUMENT

DATE

AMOUNT

T-Bill

12 Dec 

3,000 Mln.

T-Bill

26 Dec

13,460 Mln.

 


 

REPO RATES

 

THIS WEEK

1 WEEK AGO

1 YEAR AGO

Overnight

04.25

04.50

03.00

1 Week

04.25

04.00

05.00

1 Month

04.25

03.75

07.00

3 Month

04.20

03.70

07.55

6 Month

04.10

04.05

07.80

1 Year

04.30

04.40

08.25

 


 

TREASURY BILL RATES
MATURING THIS WEEK 1 WEEK AGO 1 YEAR AGO

1 Month

04.75

04.25

07.40

2 Month

04.40

03.80

07.50

3 Month

04.25

03.90

07.65

4 Month

04.10

03.90

07.75

5 Month

04.00

04.00

07.80