close
Advertisement
Can't connect right now! retry

add The News to homescreen

tap to bring up your browser menu and select 'Add to homescreen' to pin the The News web app

Got it!

add The News to homescreen

tap to bring up your browser menu and select 'Add to homescreen' to pin the The News web app

Got it!
March 4, 2021

Rs84.3bln borrowed through PIBs

Business

March 4, 2021

KARACHI: The government on Wednesday raised Rs84.301 billion through an auction of fixed rate Pakistan Investment Bonds (PIBs) with yields increasing on shorter and longer tenors papers.

The fetched amount was lower than the pre-auction target of Rs125 billion, the auction result issued by the central bank showed.

The cut-off yield for three-year paper rose 42 basis points (bps) to 9.4100.

The State Bank of Pakistan (SBP) sold Rs28.8 billion worth of this paper.

The yield on the five-year PIBs also increased 31bps to 9.9000 percent from 9.5890 percent in the previous auction held on February 3. The SBP sold Rs35.6 billion worth of five-year PIBs.

The yield on 10-year paper rose 24bps to 10.2890 percent. The central bank sold Rs20 billion worth of these PIBs.

However, bids of 15-, 20- and 30-year PIBs were rejected by the government.

The Consumer Price Index (CPI) based inflation increased to 8.70 percent in February from 5.7 percent in the previous month.

Analysts said though the government was absorbing most of the impact of rising oil prices, it would ultimately have to be passed on, coupled with rising utility prices, which could elevate the general price level in the coming months with the onset of Ramazan soon.

The interest rates were expected to remain stable in the near-term. However, the rates seem to be hiked since the start of next fiscal year in July.

The SBP kept the policy rate steady at 7.0 percent in January. It expects inflation to fall within the previously announced range of 7-9 percent for FY2021 and trend toward the 5-7 percent target range over the medium-term.