June 03, 2019 (MLN): The State Bank of Pakistan conducted an auction on Wednesday in which it picked up Rs.114.119 Billion for 3 months.
Auction target was Rs.600 Billion against a maturing amount of Rs. 455.247 Billion, showing an additional funding requirement of Rs.144.753 Billion.
The first auction of FY20 was no different to the preceding auctions as the SBP failed to get sufficient bids as no interest was shown by market participants in the 6 month MTB while the 12 Month MTB received a solitary bid of Rs.1 Billion, which was subsequently rejected.
Market's interest was restricted to the shortest term (84 Day) T-Bill which received bids worth Rs. 223.725 Billion. With the inflation numbers for June 2019 coming in below market expectation, a case could be made that the SBP might keep the Policy Rate unchanged in the upcoming monetary policy review.
The SBP accepted Rs. 98.725 from the competitive auction at cut-off yield of 12.7495 percent, while it picked up an additional Rs.15.394 Billion from the non-competitive auction, making the total realized amount Rs.114.119 Billion.
