SBP raises Rs828bn through T-bills auction

August 24, 2022 (MLN): The State Bank of Pakistan (SBP) on Wednesday raised Rs828 billion through the auction of three, six, and twelve-month T-bills against the target of Rs750bn.

According to the auction result, the cut-off yields for three, six, and twelve-month increased by 5 basis points each to 15.79%, and 15.85%, respectively. However, the cut-off yields for twelve months remained unchanged at 15.94%.

The market had offered Rs1,630bn, out of which the government accepted bids amounting to Rs828bn, culminating in a realized value of PKR 779bn.

The total amount raised for 3-month T-bills was Rs599.74bn, Rs49.24bn for 6-month, and Rs179.32bn for 12-month T-bills.

Following the recent announcement of the Monetary Policy in which SBP paused the monetary tightening and kept the policy rate unchanged at 15.0%, T-bill auction cut-offs largely remained aligned with the policy rate.

The spread between yields in cut-off rates in the government's auctions which had increased in the past few months to 305bps, 350bps, and 355bps in three, six, and twelve-months tenor has come in line with the policy rate, Sana Tawfik, Analyst at Arif Habib Limited said in a report.

SBP's measures such as OMO injection worth Rs1.056bn last week in different tenors, especially 63days also proved vital in keeping yields broadly unchanged during today's T-bill auction, she added.

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