FINEX WEEK

 

 

By SHABBIR H. KAZMI
Updated Dec 28, 2002

 

The interbank market remained activity was brisk throughout the past week. Overnight and term rates were volatile and maintained an upward trend towards the end of the week. Treasury bill auctions were conducted which saw the three and twelve month yields being set. The PIB to be auctioned off in the coming week was also traded but amounts were thin.

Short term overnight activity was conducted at levels of 1.50% but after the T-Bill auction rates rose and touched 5.00%. Outflows were reported in the market and the market touched 7.50% on the weekend. Activity in the one and two week tenors was brisk with an upsurge in rates. Initial trades in the respective tenors were conducted at 6.25% and 5.50% as both tenors crossed the year end mark, but soon rates touched 7.50% and 6.50%. One month rates also rose from the previous week's close of 4.50% to touch 5.50% on Saturday. The auction attracted total bids of Rs. 53.05 billion against the pre-auction target of Rs. 15 billion. Rs. 20.15 billion was accepted at yields of 3.90% and 4.44% for the papers. Activity following the result announcement was brisk and the one year paper traded at a record low of 4.20% in the secondary market. This did not come as a real surprise keeping in mind that the six month paper had already traded below 4.00% as well. The PIB auction scheduled for Monday with a target of only Rs. 5 billion will further reflect the long term investment sentiment. It should be kept in mind that the ten year paper with a new coupon of 9.00% has traded at yield close to 5.60%.

Banks have been gearing up the year end by covering themselves for one week at levels as high as the discount rate. It is felt that the market will experience a shortfall but we strongly feel that market would be provided relief by the authorities.

YIELD PROFILE

FEDERAL INVESTMENT BONDS

.

THIS WEEK

1 WEEK AGO

1 YEAR AGO

1 Year

04.20

04.10

08.50%

2 Year

04.70

04.40

09.25%

3 Year

04.90

04.60

10.75%

4 Year

05.00

04.80

11.00%

5 Year

05.10

05.00

11.25%

10 Year

05.65

05.70

12.25%

 


 

AUCTIONS

BID DATE

INSTRUMENT

RESULT

SETTLEMENT

Dec 24 T-Bill 03 mth Dec 24 Dec 26
Dec 24 T-Bill 12 mth Dec 24 Dec 26

TARGET AMOUNT

BID AMOUNT

ACCEPTED AMOUNT

Rs.15,000 mln

Rs.53,050 mln

Rs.20,150 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

1 Week

07.50

02.75

07.50

1 Month

05.45

04.25

07.43

3 Month

04.10

03.88

07.30

6 Month

03.85

03.80

07.45

1 Year

04.15

04.25

07.85

 


 

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

1 Month

06.00

04.60

07.50

2 Month

04.30

04.10

07.45

3 Month

04.00

03.90

07.40

4 Month

04.00

03.85

07.50

5 Month

03.90

03.80

07.55