FINEX WEEK

 

 

By SHABBIR H. KAZMI
Updated Aug 13, 2004

 

As expected, the money market continued to remain at rock bottom levels throughout the week. Excess liquidity in the system resulted in SBP conducting OMO in shorter tenors of upto 2-week. It mopped up Rs.3.0 billion in 1-week and Rs.175 million in 2-week at 1.25%.
Overnight activity was dealt in the band of 0.25% to 0.75% during the week. However, on Friday, the rates moved up slightly and deals were executed between 0.75% to 1.00%. One and two-week tenors were

 

 

active with bids quoted at 0.50% and 0.75% against offers at 1.00% and 1.25%. Trades were however, evident between 0.50% and 0.85%. Market participants were more interested to hedge their positions upto three-month tenors and bids were available in the range of 1.30% to 1.80%. Offers were quoted between 1.70% to 2.10%. Activity was reported at 1.50%, 1.80% and 2.10% in one, two and three months respectively. No activity was seen in the T-bills.

Last week's trend continued in the bond market. Latest 10-year paper was traded as low as 7.89%. However, at close bids and offers were available at 8.10% and 7.95%. More interest was seen towards short-dated papers of upto 4-year to maturity. Bids for five-year paper carrying 13.00% coupon, remaining one and a half years to maturity were quoted at 4.35% against offers at 4.00%. Trading in five-year bond issue of 6 October, 2003 with 7.00% coupon, close to 4-year to maturity was witnessed in the range of 6.60% to 6.30% during the week.

FUTURE OUTLOOK

The upcoming maturity of Rs.35.75 billion will keep the money market liquid next week. Shorter tenor rates are also expected to remain under pressure. Six-month T-bill auction is also due in the coming week with an appreciation of 10 to 15 basis points in the cutoff yield expected.

YIELD PROFILE

FEDERAL INVESTMENT BONDS

.

THIS WEEK

1 WEEK AGO

1 YEAR AGO

1 Year

03.70

03.70

01.50%

2 Year

04.80

04.80

02.00%

3 Year

05.45

05.35

02.35%

4 Year

06.25

06.00

02.50%

5 Year

06.45

06.35

03.38%

10 Year

07.98

07.90

04.58%

 

 

 


 

AUCTIONS

BID DATE

INSTRUMENT

RESULT

SETTLEMENT

Aug 04 T-Bill 03 mth. Aug 04 Aug 05
Aug 04 T-Bill 12 mth. Aug 04 Aug 05

TARGET AMOUNT

BID AMOUNT

ACCEPTED AMOUNT

Rs.60,000 Mln. 

Rs.146,200 Mln  

Rs. 51,150 Mln 

 


 

MATURITIES

INSTRUMENT

DATE

AMOUNT

T-Bill

05 Aug

Rs. 101,035 Mln.

 

 

 


 

 

REPO RATES

 

THIS WEEK

1 WEEK AGO

1 YEAR AGO

Overnight

00.25

00.40

01.15

1 Week

00.75

00.75

00.90

1 Month

01.55

01.40

00.70

3 Month

01.95

01.95

00.80

6 Month

02.45

02.40

01.00

1 Year

02.90

02.90

01.25

 

 



 

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

1 Month

01.75

01.65

00.80

2 Month

01.85

01.85

00.75

3 Month

01.95

01.95

00.75

4 Month

02.20

02.20

00.85

5 Month

02.45

02.45

00.95