• search

Pakistani o/n rates up ahead of auction

Written by: Staff

KARACHI, June 5 (Reuters) Pakistan's short-term rates surged on Monday as banks borrowed funds ahead of a treasury bill auction due later in the week and dealers said this would keep rates firm in the short-term.

Overnight call rates closed at 8.9 percent, up from previous close of 2.0 percent.

''Many banks are short of funds,'' a dealer at a state-run bank said. ''They are gradually building up their positions to participate in the T-bill auction.'' The central bank, the State Bank of Pakistan, will auction 21 billion rupees (9.12 million) worth of three-, six- and 12-month Treasury bills on Wednesday.

Dealers said some of the major lenders also remained on the sidelines, resulting a spike in rates.

''Bids and offers for overnight funds were initially quoted at 7 percent but as some major lenders kept themselves sidelined, the market surged to the top level of 8.9 percent at the close,'' another dealer said.

He said he expected the market to hover at current levels as the liquidity positions of some banks was tight.

Dealers said the direction of the market would also depend on the cut-off yield in Wednesday's auction of the six-month maturity T-bills.

In the currency market, the Pakistani rupee ended flat at 60.13/15 to the dollar.

Dealers said strong dollar inflows had offset the impact of some scattered payments. The currency market was expected to remain stable in coming days, they said.

The rupee hit a 19-month low last month but recovered on improved dollar supplies.

Monday Previous Interbank market 60.13/15 60.13/15 Open market 60.52/57 60.53/60 For Karachi Interbank Bid Rates: click on page Revaluation rates by Financial Market Association for Treasury Bills, PIBS, FIBs Holding: click on page Revaluation rates by banks for PIBs: click on For Treasury Bonds chain: click on page <0#PKTSY> REUTERS PV PM1607

For Daily Alerts
Get Instant News Updates
Notification Settings X
Time Settings
Clear Notification X
Do you want to clear all the notifications from your inbox?
Settings X
We use cookies to ensure that we give you the best experience on our website. This includes cookies from third party social media websites and ad networks. Such third party cookies may track your use on Oneindia sites for better rendering. Our partners use cookies to ensure we show you advertising that is relevant to you. If you continue without changing your settings, we'll assume that you are happy to receive all cookies on Oneindia website. However, you can change your cookie settings at any time. Learn more