KARACHI: The State Bank of Pakistan (SBP) has reported that the government raised Rs435.5 billion through T-bills, against the auction target of Rs500 billion.
The SBP conducted the auction for the sale of 3-month, 6-month and 12-month Government of Pakistan Market Treasury Bills (MTBs) and received bids amounting to over Rs1,450 billion.
Bids worth Rs455.4 billion were received for 3-month T-bills, Rs418.9 billion for 6-month T-bills, while 12-month government papers fetched bids amounting to Rs576.7 billion.
Out of the received bids, the federal government raised Rs164 billion for 3-months, Rs126.5 billion for 6-months and Rs145 billion for 12-months.
The total acceptance in the auction, including non-competitive bids, was Rs504.4 billion.
The cut-off yields for all bids significantly decreased. This is the first T-bill auction to take place after not one, but three policy rate cuts. The central bank cut the policy rate from 13.25pc to 12.5pc on March 17, from 12.5pc to 11pc on March 24, and finally from 11pc to 9pc on April 16.
The cut-off yield for 3-month bids was at 8.39pc, down from 10.89pc. The yield for 6-month bids was at 7.99pc , down from 10.3pc, and 7.47pc for 12-month bids, down from 9.64pc.
Like the previous auction of MTBs on April 8, the bidding was more concentrated in the long term 12 month papers. This is opposed to the trend that defined most of last year and the beginning of this year, of investing in short term 3-month T-bills.
The next auction date for T-bills is set for May 6, with a target amount of Rs400 billion.