FINEX WEEK

 

 

By SHABBIR H. KAZMI
Updated Sep 04, 2004

 

SBP conducted auction of the three-month and one-year T-bill with a target of Rs.50bn. It received bids of Rs.62bn and accepted Rs.61.535bn with Rs.54.535bn in three-month at a cut-off yield of 2.6669% and Rs.7bn in 1-year at a cut-off of 3.1439% raising the cut-off yields by 48 and 31 basis points. After the auction, trades in latest three-month T-bill were seen at 2.55% with little interest in the one-year paper. Latest six-month T-bill was active before the auction with bids at 2.55% and offers at 2.50%. Deals were executed at 2.52%. Rates hiked after the auction and bids and offers were at 2.70% and 2.60%.

 

 

Overnight activity at the early part of the week was seen around 2.00%. After the auction on Wednesday, rates jumped and deals were conducted as high as 7.40%. This hike in rate was mainly due to the net outflow at the auction and the weekly averaging factor. On Friday, banks initially managed to cover themselves around 6.00% but rates dropped subsequently and funds were available in the range of 3.00% to 4.00%.

One and two-week rates also firmed from the lows of 1.25% and 1.50% to close at 3.00% and 2.50% in the respective tenors. One-month saw a hike of around 100 basis points and bids and offers in this tenor were quoted at 2.40% and 2.80% towards the end of the week. The threemonth repo market also rose to between 2.40% and 2.70% after trading at 2.30% before the auction.

Rates for PIB also moved up after the auction. Seven years to maturity paper was the most active bond during the week and rates were available in the range of 8.35% to 8.15%. Bids for latest 10-year bond issue of 29th April, 2004 were quoted at 8.25% against offers at 8.10%.

FUTURE OUTLOOK

Inflows on account of Export Refinance during the week will keep short tenor rates under pressure. No major buying interest is expected in the T-bills. In the bond market, no significant change is likely and rates are expected to remain at existing levels.

YIELD PROFILE

FEDERAL INVESTMENT BONDS

.

THIS WEEK

1 WEEK AGO

1 YEAR AGO

1 Year

04.00

03.80

01.90%

2 Year

04.85

04.65

02.60%

3 Year

05.10

05.00

03.10%

4 Year

06.05

05.90

03.10%

5 Year

06.10

05.95

04.05%

10 Year

08.10

07.89

05.14%

 

 

 


 

AUCTIONS

BID DATE

INSTRUMENT

RESULT

SETTLEMENT

Sep 01 T-Bill 03 Mth. Sep 01 Sep 02
Sep 01 T-Bill 12 Mth. Sep 01 Sep 02

TARGET AMOUNT

BID AMOUNT

ACCEPTED AMOUNT

Rs.50,000 Mln 

Rs.62,035 Mln.  

Rs.61,535 Mln.

 


 

MATURITIES

INSTRUMENT

DATE

AMOUNT

T-Bill  

02 Sep

34,535 Mln.

T-Bill  

30 Sep

85,635 Mln.

 


 

REPO RATES

 

THIS WEEK

1 WEEK AGO

1 YEAR AGO

Overnight

02.25

01.25

00.40

1 Week

02.25

01.50

00.65

1 Month

02.25

02.00

00.90

3 Month

02.45

02.10

01.15

6 Month

02.90

02.40

01.35

1 Year

03.10

02.90

01.85

 

 

 


 

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

1 Month

02.40

02.20

01.10

2 Month

02.60

02.20

01.20

3 Month

02.55

02.15

01.20

4 Month

02.65

02.40

01.35

5 Month

02.70

02.50

01.35