The State Bank of Pakistan (SBP) successfully raised Rs997 billion in Wednesday’s Treasury Bill (T-Bill) auction, surpassing the government’s target of Rs450 billion. The auction saw yields rise across most papers, reflecting market adjustments amid liquidity and monetary conditions.
Official data shows the cut-off yield for 1-month T-Bills declined by 4.9 basis points (bps), while the 3-month paper rose by 9 bps. The 6-month T-Bills surged 12 bps to 10.44% from 9.94% observed earlier.
The breakdown of amounts raised through competitive bidding: Rs70 billion for 1-month, Rs82.9 billion for 3-month, Rs31 billion for 6-month, and Rs135.9 billion for 12-month T-Bills. Non-competitive bids contributed Rs677.2 billion, while competitive bids totaled Rs319.8 billion.
Analysts said the rising yields indicate tightening liquidity in the market and higher borrowing costs for the government.
T-Bill Auction Summary
| Tenor | Amount Raised (Rs Billion) | Cut-off Yield (%) | Change (bps) |
|---|---|---|---|
| 1 Month | 70 | N/A | −4.9 |
| 3 Month | 82.9 | N/A | +9 |
| 6 Month | 31 | 10.44 | +12 |
| 12 Month | 135.9 | N/A | N/A |
| Total | 997 | — | — |
T-Bills are short-term government securities used to meet fiscal needs and manage liquidity. The increase in yields reflects market conditions, monetary policy stance, and investor demand for short-term government instruments.
