Benchmark rates of Treasury securities are beginning to bottom out after yields were on a decline during the past few months, especially with growing foreign investor interest after the war ended in April while longer term bonds have began to see an upward movement in yields.

Interest rates across the board did not move from the previous week at this week’s Treasury bills auction. The bills maturing at three, six and 12 months continued to yield 7.25 percent, 8.33 percent and 9.17 percent respectively.

During the year, benchmark rates have declined by more than 960 to 969 basis points as the Central Bank gradually loosened its tight monetary policy stance in a bid to stimulate economic growth bringing policy interest rates down to 7.50 and 9.75 for repurchase and reverse repurchase transactions respectively.

"We expect the Treasury bill yields to bottom out and bond yields are already up," a dealer said.

In the secondary market, four-year Treasury bonds were trading at 10.90 percent to 11.20 percent while five year bonds 11.10 percent to 11.40 percent last afternoon.

"The lowest Treasury bonds have been trading in the recent past was about 9.70 percent," a dealer said.

The rupee depreciated slightly from 114.35/45 overnight to 114.55/60 yesterday on seasonal importer demand.

The dollar traded at a broader range due to intervention last morning. Dealers said the Central Bank was preventing volatility in the foreign exchange market yesterday through state-banks, keeping a broad exchange rate of Rs. 114.35/60 against the dollar.

"We saw the exchange rate pick up slightly from the over night Rs. 114.35/45 range with importer demand growing and the Central Bank intervened through a state-bank who offered two rates which prevents the rupee from slipping beyond 114.60 against the dollar and gaining beyond 114.35," a dealer said.

However, by afternoon, dealers said the foreign exchange market was settled, trading at Rs. 114.55/60.