The State Bank on Wednesday conducted second Open Market Operation (OMO) within three days, picking up another big chunk of liquidity to meet the requirement of National Domestic Assets (NDA).
The SBP raised Rs 22.8 billion from the money market, which suddenly pushed the overnight rate up to 3.75 percent from 0.25 percent a day earlier.
The SBP raised the money for one week. Money market experts said that by the time this Rs 22.8 billion would rejoin the market, the inflow of Rs 78.2 billion through maturity on July 8 would be landing into the market.
"The OMO has been conducted to meet the NDA requirement," commented a money market expert.
Experts said that the State Bank would have to conduct another OMO to suck up the excess liquidity, which might touch Rs 100 billion after a week.
PRIMARY DEALERS: State Bank on Wednesday released the list of Primary Dealers for the next fiscal year which includes Muslim Commercial Bank as new member.
"It is advised that the following institutions have been selected to act as Primary Dealers for the financial year 2004-2005," said a circular issued by the SBP.
Citibank N.A, United Bank Limited, National Bank of Pakistan, Habib Bank Limited, ABN Amro Bank N.V., Jahangir Siddiqui & Company Limited, Pak Oman Investment Company Limited, American Express Bank Limited, Standard Chartered Bank, Union Bank Limited, Bank Alfalah Limited and Muslim Commercial Bank.