August 7, 2022 (MLN): Amid higher interest rates, the government on Saturday increased profit rates on various saving schemes by 24-125 bps.
The Central Directorate of National Savings (CDNS) has raised the profit rate on the Regular Income Savings Certificates by 24bps to 12.6% from 12.36% previously.
The rate of profit on a savings account was revised upwards by 125bps from 12.25% to 13.5%.
However, the profit rate on Pensioners, Behbood (Welfare) and Special Saving Certificate remained unchanged at 14.16%, 14.16% and 13% respectively.
Moreover, the rate of return on Defence Saving Certificates also remained unchanged at 12.4%.
Meanwhile, it is important to note that CDNS announced rates on national savings schemes after every two months which are linked to the cut-off yield of T-bills and long-term PIBs.
In recent auctions, the government raised Rs1trillion through T-bills and Rs298.5 billion through PIBs. The cut-off yields for three, six, and twelve-month T-bills stood at 15.75%, 15.80%, and 15.94%, respectively. While the cut-off yield for 3-year and 5-year PIBs decreased by 5bps to 13.94% and 13.4% respectively.
In the last MPC meeting, SBP raised the monetary policy rate by 125bps to 15%. The next MPC meeting is scheduled for August 22, 2022, wherein the Central Bank is expected to increase the policy rate to arrest the sharp rise in consumer prices and slow down the overheated economy.
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