The federal government raised Rs2.068 trillion through the latest auction of Market Treasury Bills (MTBs), with borrowing costs falling across all maturities to levels below the State Bank of Pakistan’s benchmark policy rate.
The government accepted bids worth Rs2,067.9 billion against a target of Rs2.4 trillion, while the benchmark policy rate currently stands at 11.5 percent.
The auction recorded a broad decline in cut-off yields, which fell between 31 and 40.3 basis points compared with the previous auction, reflecting strong investor demand and easing expectations for interest rates.
The one-month Treasury Bill recorded the largest drop, with its cut-off yield declining by 40.3 basis points to 11.3968 percent.
The three-month bill yield fell 35.2 basis points to 11.3978 percent, while the six-month and 12-month yields eased to 11.4375 percent and 11.4880 percent, down 31 basis points and 35 basis points, respectively.
The government relied primarily on longer-term borrowing, raising Rs1.088 trillion through 12-month Treasury Bills, accounting for more than half of the total amount secured during the auction.
It also mobilized Rs485.3 billion through six-month papers, Rs396.5 billion via three-month bills and Rs98.4 billion through one-month securities.
Of the total amount raised, Rs1.063 trillion came from competitive bids, while Rs1.004 trillion was accepted through non-competitive bids.
Weighted average yields also declined across all tenors, with one-month, three-month, six-month and 12-month Treasury Bills settling at 11.3917 percent, 11.3716 percent, 11.3904 percent and 11.3731 percent, respectively.
