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The overnight call money rate was flat and range-bound throughout the last week. Most of the time, overnight call money rate ranged between 10.00-12.00 per cent.
In the Treasury bill auction held Sunday, bid for Tk 8,437.00 million was accepted, compared with total Tk 4,818.00 million in the previous week's bid. Weighted average yields bid not change much from previous week.
Demand for US dollar was high in the past week and US dollar remained bullish against Bangladesh taka.
The yen hit one-week lows versus the dollar and euro in the beginning of the week as expectations grew that Japan's interest rates would stay near zero even after the bank of Japan ends its ultra-easy monetary policy, as early as this week.
The European single currency drew broad support as investors have warmed to the view that euro zone interest rates might rise further. The Swiss France was up around 0.2 per cent against the dollar and hit a one-week high versus the euro ahead of an expected 25 basis point interest rate increase by the Swiss National Bank Thursday.
During the middle of the week, the yen recovered slightly from the previous day's two-week lows against the dollar, as investors awaited a potential end o the bank of Japan's ultra-loose monetary policy on Thursday.
The yen rose sharply Thursday from an earlier two-week low against the dollar and firmed versus the euro after the bank of Japan scrapped its five-year-old ultra-easy monetary policy and said the economy is recovering steadily.
Commercial Bank of Ceylon
In the last week the local call money rate remained mostly steady. The local money market dealers are expecting similar range in the call money rate at the beginning of new week.
The inter-bank call money rate for banks hovered between the range of 11.50 per cent and 12.50 per cent. Bangladesh Bank has injected Tk 1.2650 billion in the money market by accepting less Treasury Bills than maturity. But this inflow had no impact on the local call money rate.
In the last week, Tk 8.4370 billion worth of T-bill was accepted by the Bangladesh Bank, while maturity of previously accepted T-bills was Tk 9.7020 billion. Bangladesh Bank accepted only 28-days, 182 days, 364 days and 2 years T-bills. Yield of 28-Days T-bill was at 7.05 per cent, yield of 182 Days T-bill was at 7.47 per cent, yield of 364 Days T-bill was at 7.75 per cent and yield of 2 years T-bill was at 8.65 per cent. On average, yield of T-bills in this week was slightly higher compared to the previous week.
Local foreign exchange market, in the past week, the US dollar's value kept its bullish tone against Bangladesh Taka due to continued high demand for foreign exchange to meet import-related obligation.
The local Foreign Exchange dealers speculate that the US dollar/Taka exchange rate to be higher in the coming week.
The US dollar/Taka exchange volume was insignificant mainly due to no one wants to make direct sale of US dollar/Taka at high rate, which may worsen market condition and may create panic. In last week the daily average volume of US dollar/Taka transaction was $0.48 million against $0.24 million in the week before.
On the other hand, daily average volume of FC/Taka transaction was $12.92 million against $6.18 million in the week before, which is 109.16 per cent higher. Banks' increased exchange rate for clients and decreased cross currency volume suggested that supply was limited against demand for foreign currency this week.
The US dollar/Taka selling rates for importers of major Foreign and Private Banks ended higher at 69.97/72.24, while US dollar Buying rates from exporters were at 69.00/71.17 For non-commercial payments (i.e. Tele Graphic Transfer as donations, wage earners remittance, dollar drafts etc), the range of average TT Buying rates from customers was between 69.02 and 71.20, while average TT Selling rate was at 69.92/72.235.
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