FINEX WEEK

 

 

By SHABBIR H. KAZMI
Updated Sep 18, 2004

 

Money market remained firm during the week with rates showing an upward bias. Overnight trades were executed at around 4% initially but, as the week progressed, it jumped to 7.40% as the market went in for the discount window of the SBP for a total discounting of almost Rs.10b. Major activities in the market was confined in the shorter tenor where volatility in rates was seen across the board. One-week was traded between 6.25% and 5.50% while two-week between 5.25% and 4.25%. 

 

 

One-month was also active during the week firmer by around 40 to 50 basis points at around 3.30%. Long-term saw no major activity with three and six-month bids available at 2.80% and 3.00% against offers at 3.20% and 3.30%.

Six-month treasury bill auction was conducted on Wednesday with a target of Rs.2.0b. Of this, a total of Rs.1.1b was accepted at a cut-off yield of 3.0334% (39 basis points higher than the previous cut-off) confirming a rising interest rate scenario.

Bond market was comparatively quite and banks were reluctant to take new position in long-term papers. Selling interest was seen in the latest ten-year PIB which pushed the yields to higher levels of 8.10% and 8.35%.

FUTURE OUTLOOK

Tight condition in the inter-bank money market is likely to persist as no major inflows are expected during this week and rates may stay on the higher side. Due to the rising interest rate scenario, no major activity is expected in the bond market and yields are likely to remain on the higher side.

YIELD PROFILE

FEDERAL INVESTMENT BONDS

.

THIS WEEK

1 WEEK AGO

1 YEAR AGO

1 Year

04.20

04.10

02.10%

2 Year

04.80

04.75

02.95%

3 Year

05.10

04.95

03.25%

4 Year

06.15

06.00

03.35%

5 Year

06.10

05.95

04.15%

10 Year

08.20

08.00

05.18%

 

 

 


 

AUCTIONS

BID DATE

INSTRUMENT

RESULT

SETTLEMENT

Sep 15 T-Bill 06 Mth. Sep 15 Sep 16

TARGET AMOUNT

BID AMOUNT

ACCEPTED AMOUNT

Rs.2,000 Mln. 

Rs.5,700 Mln. 

Rs.1,100 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

07.00

04.00

00.40

1 Week

06.00

04.00

00.75

1 Month

03.10

03.00

01.30

3 Month

03.00

02.75

01.40

6 Month

03.15

02.95

01.60

1 Year

03.40

03.25

01.90

 


 

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

1 Month

03.40

03.00

01.35

2 Month

03.00

02.80

01.40

3 Month

02.85

02.70

01.45

4 Month

02.95

02.75

01.50

5 Month

03.00

02.75

01.55