FINEX WEEK

 

 

By SHABBIR H. KAZMI
Updated Feb 01, 2003

 

The interbank market continued to be flooded with liquidity that caused interbank trading at rock bottom levels. Trading ranging from overnight funds to one, two week and one month trades were conducted at levels that the market had not anticipated. However, there was a sudden turn on Friday that did bring the market somewhat at slightly improved levels. Secondary

 

 

market T-Bill and PIB yields improved compared to the record levels that were witnessed in the third week of January.

Overnight activity was restricted to below 1.00% for most parts of the week. Fund changed hands at lows of 0.25% but only turned-around on Friday that saw some banks panicking and covering themselves at high as 6.50%. Saturday saw a similar trend but lenders were unable to hold onto rates for long and after initial activity at 4.00%, rates fell back to the 1.00% mark. One and two week rates also remained under pressure with trades in respective tenors at .75% and 1.00% while lowest activity for one month was also reported at 1.25%. Banks covered themselves heavily in the one month tenor where funds were also witnessed being in call. Keeping in mind that the target for the upcoming auction could surely be much more than the maturity, the borrowers welcomed the funds. The T-Bill secondary market was active throughout the past week with the latest one year and six month papers initially changing hands at 2.30% and 2.60%, respectively. It was only later that yields made a comeback with the six month and one year papers reportedly trading at around 2.80% and 3.25%. The long term market was also digesting the news that rates are to remain unchanged yields on ten year PIBS improved with eight years to latest papers trades being conducted at higher levels of 5.20% and 5.30%.

The six month T-Bill auction scheduled for next week is sure to witness participation and the cut-off at record levels. Buying for the six month paper also already been conducted as low as 2.30% but expectations of the cut-off at around 2.75% may not be on the wane.

YIELD PROFILE

FEDERAL INVESTMENT BONDS

.

THIS WEEK

1 WEEK AGO

1 YEAR AGO

1 Year

03.20

02.70

06.75%

2 Year

03.60

03.10

07.50%

3 Year

03.90

03.60

08.50%

4 Year

03.90

03.60

09.00%

5 Year

04.20

04.00

09.50%

10 Year

05.25

05.05

10.75%

 

 

 


 

AUCTIONS

BID DATE

INSTRUMENT

RESULT

SETTLEMENT

Jan 22 T-Bill 03 mth. Jan 22 Jan 23
Jan 22 T-Bill 06 mth. Jan 22 Jan 23

TARGET AMOUNT

BID AMOUNT

ACCEPTED AMOUNT

Rs.30,000 Mln

Rs.83,647.6 Mln

Rs.28,555.6 Mln

 


 

MATURITIES

INSTRUMENT

DATE

AMOUNT

T-Bill

06 Feb 

34,912 Mln.

T-Bill

20 Feb 

2,600 Mln.

 

 

 


 

REPO RATES

 

THIS WEEK

1 WEEK AGO

1 YEAR AGO

Overnight

01.75

00.35

07.50

1 Week

01.75

01.25

04.25

1 Month

02.00

02.00

04.75

3 Month

02.40

02.15

04.5S

6 Month

02.60

02.30

05.40

1 Year

03.00

02.55

06.05

 


 

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

1 Month

02.50

02.40

04.75

2 Month

02.35

02.25

04.60

3 Month

02.60

02.25

04.60

4 Month

02.65

02.30

04.80

5 Month

02.65

02.35

05.15