KARACHI: Yields on market treasury bills remained steady on Wednesday in the first auction following the central bank left its key interest rate unchanged at 21 percent to rein in inflation and prevent economic growth from falling further.
The government raised Rs2.2 trillion through an auction of treasury papers, much higher than the pre-auction target of Rs1.2 trillion.
The cut-off yield on the three-year T-bill stood at 21.9999 percent, unchanged from the previous auction. The yield on the six-month paper was up by 5 basis points at 21.9890 percent. The yield on a 12-month paper ended flat at 21.9997 percent.
The chief executive of Topline Securities, Mohammad Sohail, said the T-bill yields remained unchanged in line with forecasts following no change in the policy rate.
Analysts said the heavy participation at the auction was seen in the three-month paper. This reflects investors’ expectations that the interest rates will remain steady at the upcoming monetary policy reviews. They said the T-bills yields were steady as investors digested inflation data and assessed its implications for the central bank’s rate-hiking cycle.
The government has been forced to borrow heavily from domestic banks to meet its rising financing needs, due to insufficient inflows of external loans. As of May 12, 2023, the government had borrowed more than Rs3 trillion to finance the budget deficit.
A representational image of gold jewellery. — AFP/fileKARACHI: Gold prices increased by Rs1,000 per tola on Friday...
A representational image of oil pump. — AFP/fileBUDAPEST: Hungary will face fuel shortages from September if full...
A man stacks gas cylinder in street stall, as Venezuela prepares for elections, July 20, 2024. —...
A man looks at a chart on display in an electronic board at the digital trade on June 17, 2022. — AFPGENEVA: Efforts...
On the screen, the video of the fighting game is being shown to the citizens. — AFP/fileSHANGHAI: A long-haired...
New British finance minister Exchequer Rachel Reeves speaks at an event in London on July 8, 2024. —...