FINEX WEEK

 

 

By SHABBIR H. KAZMI
Updated Nov 06, 2004

 

The inflow of Rs.11.40bn kept the inter-bank market liquid during the week. The SBP intervened in the market by conducting two OMOs and accepted Rs.8.10bn and Rs.380mn in one and two-week respectively. The one-week cut-off was 2.1556 i.e. 15 basis points higher than the previous cut-off while, two-week funds were accepted at the yield of 2.45%.

 

 

Overnight activity was seen at the levels of 0.20% to 0.30%. It was on Friday when overnight rates moved up and deals were executed as high as 7.40%. Banks unable to square their positions approached SBP for rescue as a result of which discounting of around Rs.850mn took place.

Shorter tenors were seen active during the week. Most of the banks were seen interested to cover their positions in one-month due to Eidcrossing funds. Bids were quoted at 3.10% against offers at 3.50%. Activity was witnessed in the range of 3.10% to 3.25%. Three-month was also seen active with bids quoted at 3.60% against offers at 3.80%. Deals were executed in the band of 3.60% and 3.70%.

Market participants remained quiet in Treasury bills. The latest three-month T-bill rates moved up with bids quoted at 3.50% against offers at 3.25%. However, no activity was reported.

The yield on latest 10-year PIB further moved down due to buying interest coupled with thin target amount set by the Central Bank for the upcoming PIB auction on Nov 11th 2004. Initial deals were executed in the band of 7.70% to 7.60%. The week ended with bids quoted at 7.65% against offers at 7.55%.

FUTURE OUTLOOK

Despite inflows of Rs.22.60bn on account of OMO, the inter-bank market is expected to remain high due to pre-Eid outflows in the coming week. Six-month T-bill auction is due in the next week. The six-month T-bill cut-off is expected to rise further from the previous cut-off i.e, 3.2403%.

 

 

YIELD PROFILE

FEDERAL INVESTMENT BONDS

.

THIS WEEK

1 WEEK AGO

1 YEAR AGO

1 Year

04.30

04.30

02.40%

2 Year

05.20

04.95

02.90%

3 Year

05.40

05.10

04.00%

4 Year

06.25

06.10

04.50%

5 Year

06.40

06.15

05.00%

10 Year

07.63

07.90

06.12%

 


 

AUCTIONS

BID DATE

INSTRUMENT

RESULT

SETTLEMENT

Oct 27 T-Bill 12 Mth. Oct 27 Oct 28
Oct 27 T-Bill 03 Mth. Oct 27 Oct 28

TARGET AMOUNT

BID AMOUNT

ACCEPTED AMOUNT

R s.50,000 Mln.  

Rs.43,050 Mln. 

20,350 Mln

 


 

 

 

MATURITIES

INSTRUMENT

DATE

AMOUNT

T-Bill  

22 Nov

03,254 mln.

T-Bill  

24 Nov

56,335 min.

 


 

REPO RATES

 

THIS WEEK

1 WEEK AGO

1 YEAR AGO

Overnight

04.25

00.25

01.75

1 Week

04.00

01.25

02.00

1 Month

03.40

02.60

01.70

3 Month

03.60

03.05

01.65

6 Month

03.85

03.40

01.70

1 Year

04.20

04.20

02.00

 


 

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

1 Month

03.50

02.75

01.90

2 Month

03.60

02.85

01.80

3 Month

03.40

03.05

01.55

4 Month

03.50

03.15

01.60

5 Month

03.55

03.20

01.65