KARACHI: The government raised Rs784 billion (realised value) from the auction of market Treasury bills on Wednesday, with yields increasing across all tenors, returning to double digits.
The one-month T-bill cut-off yield rose 30 basis points (bps) to 10.1977 per cent, the auction result published by the State Bank of Pakistan (SBP) showed. The yield on the three-month paper advanced 30bps to 10.1983 per cent. The six-month T-bill yield increased 37bps to 10.3237 per cent. The 12-month T-bill yield was up 40bps to 10.3997 per cent.
The government raised Rs823 billion (face value) from the T-bills auction against the target of Rs650 billion and maturity of Rs697 billion. The auction saw the participation of Rs2.355 trillion.
“T-bill yields reversed from last auction’s single-digit levels, moving higher as the absence of an SBP policy rate cut led to repricing across tenors,” said Saad Hanif, head of research at Ismail Iqbal Securities.
The government rejected bids for the auction of 10-year floating-rate Pakistan Investment Bonds (PIBs). Last month, the SBP kept its benchmark interest rate unchanged at 10.5 per cent, citing sticky core inflation. The central bank expects inflation to stabilise within the target range of 5-7 per cent in FY26 and FY27, after temporarily exceeding the upper bound for a few months during this calendar year.
This outlook is subject to risks emanating from volatility in global commodity and domestic wheat prices, unanticipated adjustments in administrative energy prices, and a sharper-than-assumed pickup in domestic demand, it said.Pakistan’s consumer price index inflation edged up to 5.8 per cent in January, slightly higher than 5.6 per cent in the previous month.
