The State Bank of Pakistan (SBP) injected a combined Rs983 billion into the money market on Thursday through conventional and Shariah-compliant open market operations (OMOs), providing short-term rupee liquidity as banks sought funding ahead of the weekend settlement cycle.
The central bank accepted Rs661 billion via its conventional 8-day reverse repo (injection) at a rate of return of 10.54%, after banks offered the full amount at ranges between 10.62% and 10.54%, according to SBP data. All eight bids submitted were accepted at face value.
In a parallel operation, the SBP injected Rs322 billion through an 8-day Shariah-compliant Mudarabah-based OMO, accepting the entire amount at a 10.56% return, with two quotes offered and accepted at face value.
OMOs are short-term liquidity operations through which the SBP either injects (reverse repo purchases) or absorbs (repo sales) funds to keep money market rates aligned with the policy rate. Thursday’s sizeable injection suggests banks required additional liquidity to meet funding obligations, with the accepted rates indicating borrowing costs edging just above the recently cut policy rate of 10.5%.
A heavier liquidity footprint by the central bank typically reflects tighter rupee conditions early in the week and ahead of settlement cycles, while the dual use of Islamic and conventional channels continues to expand liquidity access across the banking system.
