T-bills auction see heightened participation, yields remain stable

December 13, 2023 (MLN): The State Bank of Pakistan (SBP) conducted an auction on Wednesday in which it sold Market Treasury Bills (MTBs) worth Rs2.151 trillion for 3,6 and 12 months against a target of Rs2.25tr.

To note, the auction got very high participation of Rs4.629tr following yesterday's Monetary Policy Committee's decision to maintain policy rate at 22% for the fourth consecutive meeting.

Cut off yields for 3, 6, and 12 months were 21.4499%, 21.4201%, and 21.4300%.

This means that the yields remained stable for 3 and 12-month papers, while the 6-month MTB saw a marginal decline of 1bps.

The SBP received bids worth Rs952.95bn for 3 months, Rs406.49bn for 6 months, and Rs3.27tr for 12 months out of which it accepted Rs168.13bn for 3 months, Rs5.9bn for 6 months, and Rs1.82tr for 12 months.

In addition, the SBP picked up Rs157.62bn from the non-competitive auction, making the total amount accepted Rs2.151tr.

The bid-to-cover ratio, which shows the amount of bids received versus the amount sold, rose to 2.15 as against 1.75 in the previous auction.

To note, the central bank in the last auction held on November 29 sold MTBs worth Rs1.17tr against a target of Rs900bn.

Cut-off yields for 3, 6, and 12 months were 21.4499%, 21.4299%, and 21.43%.

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