We wrote that Category A COEs (for cars below 1.6-litres and taxis) would "hold steady or rise a bit", and they duly responded this week by gaining $602 to close at $10,803.

Meanwhile, Category B certificates (for cars above 1.6-litres) sagged $201 after we called that end of the market a "dead horse", and the Open Category COE (for anything on wheels) threw us a nice curveball by climbing $298 at the close of bidding to $11,101, against our expectations

On the face of it, Cat A's modest rise was quite predictable. In early July there were 2,867 bids for 2,216 COEs, leaving 651 empty-handed after bidding closed. Some of them will have been switched to Open Cat COEs (which might explain the certificate's ability to break above $11,000), but others will have had to try again this week, and adding their number to a pool of fresh buyers was always going to make competition for the COE fiercer.

As for fresh buyers, there will have been some. The very lowest end of the market, where cars like the Kia Picanto, Perodua Kelisa and new entrant Chery QQ prowl, is the one segment where dealers say some active buying is still going on.

Chery's entry also had the effect - though it could be pure coincidence - of causing the Kia Picanto's price to take a sudden dip. Meanwhile, the market's dominant player Borneo Motors raised prices for their models below 1.6-litres a net $500 after last round's $900 COE rise, and buyers do notice these things. When COEs rise by $X but car prices rise by less than $X, some are happy to consider it a discount, thank you very much.

So, this round of Cat A COEs was quite hotly-contested, with 2,776 bidders chasing 2,221 certificates. That level of relative demand is the strongest we've seen for some time.

Bids for Cat B COEs actually intensified this week, too, but strangely enough despite the increased demand, the certificate actually wound up cheaper than it was two weeks ago. This could have something to do with the 'quality' of the bids, which in turn has to do with the dealer's margin.

If a dealer sells you a car with COE at $100, and knows that to make a decent profit he would have to sell the car alone for $90, the maximum he would be able to bid for your COE would be $10.

With run-out models of the soon-to-be-replaced Toyota Camry still selling well in early July, and selling for what was essentially a giveaway price at $79,988, there was probably not much room for Borneo Motors to put in strong COE bids, and the slight fall in the premium for Cat B certificates could be a reflection of that.

Now that the Camry is sold out (in 2.0-litre form, with the 2.4-litre dwindling in supply as we went to print), and nothing selling strongly at the moment to take its place, we don't see much action in store at all for next round's Cat B COE market, and so a continuation of this certificate's price is what's to be naturally expected.

In fact, we don't anticipate that much action for the Category A market, either. Dealers have more or less held prices steady, so the corresponding COE is unlikely to see a significant swing in either direction.

The COE market seems to be treading water above $10,000 for the moment, and conditions ahead look calm.

Category A July 2nd tender
52-week high: $16,502
52-week low: $8,009
Quota: 2,221
Bids: 2,776


Cat A continues to see action at the budget end of the market, but we hear that the new Civic 1.6 is packing buyers into Honda showrooms. This could be enough to stir the market a little, although deliveries for that car will only start around late September.

Still, from what we hear, Civic margins have been helped along by a flaccid Yen, and are able accommodate a $11,101 COE with ease, so some early buyers of the car could take delivery with a Cat E certificate instead of a Cat A one...

Category B July 2nd tender
52-week high: $16,889
52-week low: $9,001
Quota: 1,089
Bids: 1,332

Following last round's $200 dip, Cat B went $1 better this round to fall a further $201. The quota for this round went up by five Certificates, and the number of bids jumped by 92. But the fact that the premium for this Cat dropped is a strong indicator of the lack of 'quality bids'.

Furthermore, now that suddenly the attention is on cars like the Cat A 1.6-litre Honda Civic, there's little left in the volume end of the Cat B class to really excite buyers. At least not until the all-new Camry hits local showrooms. Therefore expect for Cat B prices to remain as they have been for the next round of bidding.

Category E July 2nd tender
52-week high: $17,199
52-week low: $9,275
Quota: 1,127
Bids: 1,718

So, why has the market been willing to bid Open Cat COEs above the $11,000 mark? These COEs, being transferable, can be used for what?s called 'immediate registration' in the trade, which allows dealers to deliver a big shipment of cars to eager early buyers of a hot new model.

With COEs valid for six months after being secured, that means an Open Cat COE now could be used all the way up to January. So, are dealers stockpiling them in anticipation of November's Singapore Motor Show, the end-of-year bonus period, or the Chinese New Year rush? Or all three?