SBP raises Rs351bn via T-bills auction, yields come down upto 29bps

May 18, 2022 (MLN): The cut-off yields of T-bills were decreased by up to 29 basis points in the auction conducted by the State Bank of Pakistan (SBP) on Wednesday.

The government raised Rs351 billion through the auction of three, six, and twelve-month T-bills against the target of Rs500bn and maturity of Rs279bn.

The cut-off yields for 3-month, 6-month, and 12-month T-bills saw a decline of 29, 29, and 5 basis points to stand at 14.5%, 14.7%, and 14.75%, respectively.

The market had offered Rs1,008bn, out of which the government accepted bids amounting to Rs351bn.

SBP received bids worth Rs562bn for 3-month T-bills, Rs211bn for 6-month, and Rs234bn for 12-month.

The total amount raised for 3-month T-bills was Rs234.8bn, Rs59.9bn for 6-month, and Rs56.1bn for 12-month T-bills.

The average spread between 3M, 6M, and 12M T-bills and policy rate used to be 0.72%, 1.16% and 1.4% (during the last 1 year) respectively.

Following the recent declining trend seen in the secondary market, cut-offs in the primary market too declined, Analyst at Arif Habib Limited said.

Moreover, majority participation was witnessed in 3M with investors preferring to invest in the shortest tenor in anticipation of any further rate hike, he added.

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