Govt raises Rs427 billion through PIB auction, exceeding target

The government successfully raised Rs427 billion by auctioning Pakistan Investment Bonds (PIBs), surpassing its target of Rs350 billion. 

The government raised the largest portion of the funds—Rs287.6 billion—through 10-year PIBs, while the highest number of bids, amounting to Rs305 billion, was for 5-year bonds. 

The additional Rs77 billion raised highlights the increasing need for government spending and the availability of over-liquid banks, which submitted bids totaling Rs887 billion for the PIBs.

For the auction, the government raised Rs37 billion for 2-year PIBs, Rs38 billion for 3-year PIBs, Rs93.2 billion for 5-year PIBs, and Rs247.6 billion for 10-year PIBs. 

This long-term investment indicates growing confidence in falling inflation and interest rate stability, particularly after the State Bank slashed its policy rate by 1,000 basis points to 12% in June 2024, down from 22%.

According to a report from the State Bank of Pakistan, long-term PIBs increased by Rs4.5 trillion during the first eight months of fiscal year FY25. The total PIBs raised by the government rose to Rs32.5 trillion in February 2025, up from Rs28 trillion in June 2024.

Financial experts said that the strong demand reflects banks’ liquidity, while the government’s focus on long-term bonds aligns with its strategy to secure debt over extended periods, a trend also observed in recent treasury bill auctions.