FINEX WEEK

 

 

By SHABBIR H. KAZMI
Updated May 03, 2003

 

For most part of the week, overnight activity was seen in a band of 1.75% and 2.00%. However, after the T-bill auction on Wednesday, rates jumped and deals were conducted as high as 7.40% on the weekend. This hike in rates was mainly because of the mismatch between maturity and the auction amounts. It was on Friday that banks managed to cover themselves in the band of 6.50% and 7.40%. One and two week rates also took a hike from the lows of 1.75% to close at 3.50% and 3.00% in the respective tenors.

 

 

One month saw a hike of around 30 to 40 basis points and funds in this tenor changed hands around 2.15% towards the end of the week. The three-month repo market also rose sharply to 2.10% after trading at 1.75%, initially.

State Bank conducted a T-bill auction with a target of Rs. 10.00 billion but accepted Rs. 12.2 billion at a cut-off yield of 1.6878% which was 0.03 basis points lower than the previous cut-off at 1.7193%. After the T-bill auction, aggressive selling was seen and less than one-year to maturity paper was traded in a band of 2.40% and 2.50%.

We see this week as tight but the market should ease in the following week on the expected inflows of around Rs.45 billion due on 15th May 2003 from the T-bill maturity. However, a clearer picture will emerge once the target amount for that maturity is set by the State Bank.

YIELD PROFILE

FEDERAL INVESTMENT BONDS

.

THIS WEEK

1 WEEK AGO

1 YEAR AGO

1 Year

02.75

02.40

07.10%

2 Year

03.00

02.90

07.75%

3 Year

03.15

03.10

08.40%

4 Year

03.15

03.10

08.40%

5 Year

03.60

03.40

09.40%

10 Year

04.90

04.60

10.60%

 

 

 


 

AUCTIONS

BID DATE

INSTRUMENT

RESULT

SETTLEMENT

Apr 30 T-Bill 06 mth Apr 30 May 02

TARGET AMOUNT

BID AMOUNT

ACCEPTED AMOUNT

Rs.10,000 Mln.

Rs.27,475 Mln.

Rs.12,200 Mln.

 


 

MATURITIES

INSTRUMENT

DATE

AMOUNT

T-Bill

02 May

7,650 Mln.

T-Bill

15 May

45,400 Mln.

T-Bill

29 May

25,500 Mln.

 


 

REPO RATES

 

THIS WEEK

1 WEEK AGO

1 YEAR AGO

Overnight

06.50

01.95

08.65

1 Week

04.50

01.80

06.75

1 Month

02.25

01.65

06.00

3 Month

01.95

01.60

05.80

6 Month

02.05

01.65

06.25

1 Year

02.55

02.45

06.80

 

 

 


 

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

1 Month

02.65

01.90

06.30

2 Month

02.10

01.65

06.00

3 Month

01.95

01.55

05.80

4 Month

01.95

01.65

06.05

5 Month

02.00

01.65

06.25