State Bank of Pakistan reported on Thursday that the government will be raising Rs3,650b via the auction of treasury bills and Pakistan Investment Bonds (PIBs)in June-August 2017. The central bank said that the government will raise Rs3.4t through treasury bills and Rs250b through PIBs in the next three months.
The outstanding stock of PIBs is around Rs4.27t of which banks hold Rs3t and the rest are held by the corporate sector and non-banks. Since the coming down of interest rates, PBIs are no longer an attractive source of borrowing instruments for the government. The government will be raising a much lesser amount from PIBs in comparison to previously to reduce its percentage of bond holdings.
Treasury bills (TBs) worth Rs3.137t are expected to mature during the Jun-Aug period when the government intends to raise more from PBIs and TBs. The figure for borrowing budgetary support has reached Rs 849.5b barely a month before the current financial year ends. It is most likely this figure will cross Rs1t for the whole FY 2016-17.
