FINEX WEEK

 

 

By SHABBIR H. KAZMI
Updated July 10, 2004

 

As expected, 30 to 45 basis point increase was seen in the latest T-bill auction. The Central Bank accepted Rs.64.95bn in 3-month tenor at the rate of 2.0519% and sold 1-year T-bill worth Rs.0.55bn at the cut-off yield of 2.6979% against target of Rs.60.0bn. However, rates remained on the lower side due to excess liquidity in the system.

 

 

During the week, overnight activity was seen in the narrow band of 0.10% to 0.25%. One and two-week rates remained stagnant throughout. One-week deals were executed in the range of 0.35% to 0.50%, whereas twoweek traded between 0.50% and 0.75%. One month activity was concluded at 1.40% to 1.50% whereas, three-month trades were evident at the level of 1.70% to 1.80%. Heavy demand was seen in the latest three-month T-bill. Bids and offers were initially quoted at 1.95% and 1.75% with deals initiated at 1.90% and 1.80%. Later, rates eased-off and bids were available at 1.75% against offers at 1.73%. However, activity was reported at 1.75%. Bids and offers for latest one-year paper were quoted at 2.70% and 2.50% although, no significant activity was seen.

In the bond market, rates for three, five and ten-year bonds eased-off due to surplus liquidity in the system. Latest three-year bond was traded at 5.20% to 5.15% as against 5.55% to 5.45%. However, bids and offers for five-year paper were available at 6.40% and 6.25%. Bids for latest ten-year bonds were quoted at 7.79% and offers were at 7.75%.

FUTURE OUTLOOK

Due to surplus liquidity, overnight rates are likely to remain at the lower level. It is also expected that rates for all tenors will be under pressure. However, heavy demand in short dated T-bill is expected in next week.

YIELD PROFILE

FEDERAL INVESTMENT BONDS

.

THIS WEEK

1 WEEK AGO

1 YEAR AGO

1 Year

03.30

03.40

01.90%

2 Year

04.50

04.60

02.40%

3 Year

05.10

05.50

02.75%

4 Year

06.10

06.10

02.75/.

5 Year

06.40

06.50

03.75%

10 Year

07.79

07.78

04.76%

 

 

 


 

AUCTIONS

BID DATE

INSTRUMENT

RESULT

SETTLEMENT

Jul 07 T-Bill 03 mth. Jul 07 Jul 08
Jul 07 T-Bill 12 mth. Jul 07 Jul 08

TARGET AMOUNT

BID AMOUNT

ACCEPTED AMOUNT

Rs.60,000 Mln.  

Rs.130,975 Mln.

Rs. 65,500 Mln

 


 

MATURITIES

INSTRUMENT

DATE

AMOUNT

T-Bill

08 July

78,200 Mln.

 

 

 


 

REPO RATES

 

THIS WEEK

1 WEEK AGO

1 YEAR AGO

Overnight

00.15

00.20

00.45

1 Week

00.50

00.50

00.65

1 Month

01.25

01.40

01.30

3 Month

01.65

01.80

01.40

6 Month

02.05

02.20

01.55

1 Year

02.65

02.70

01.90

 

 

 


 

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

1 Month

01.35

01.65

01.40

2 Month

01.65

01.90

01.40

3 Month

01.75

02.00

01.50

4 Month

01.85

02.10

01.50

5 Month

02.10

02.20

01.55