SBP sells T-bills worth Rs361bn, yields rise by up to 126bps

February 21, 2024 (MLN):The State Bank of Pakistan (SBP) conducted an auction on Wednesday in which it sold Market Treasury Bills (MTBs) worth Rs361.32 billion for 3,6 and 12 months against a target of Rs300bn.

Cut off yields for 3, 6, and 12 months were 21.6998%, 20.3952%, and 20.3290%, depicting a rise of 126bps in 3 month, 25bps in 12 month, while the yield for 6 month papers remained unchanged.

To note, the central bank in its last meeting kept borrowing costs at a record high of 22% for a fifth consecutive meeting to curb inflation.

Total amount offered was Rs1.293tr out of which the SBP accepted Rs361bn.

The SBP received bids worth Rs649.16bn for 3 months, Rs66.67bn for 6 months, and Rs576.69bn for 12 months out of which it accepted Rs310.16bn for 3 months, Rs0.62bn for 6 months, and Rs16.5bn for 12 months.

In addition, the SBP picked up Rs34.1bn from the non-competitive auction, making the total amount accepted Rs361bn.

The bid-to-cover ratio, which shows the amount of bids received versus the amount sold, dropped to 3.58 as against 20.25 in the previous auction. In other words, the SBP accepted about 28% of the total bids it received.

To note, the central bank in the last auction held on February 06, 2024 sold MTBs worth Rs64bn against a target of Rs480bn.

Cut-off yields for 3, 6, and 12 months were 20.4399%, 20.3951%, and 20.08%.

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