KARACHI: The government on Wednesday raised Rs551 billion through the auction of Market Treasury Bills against the target of Rs700 billion.
The cut-off yield on the three-month paper slightly fell to 7.2589 percent from 7.3091 percent.
Similarly, the yield on the six-month T-bills declined to 7.5390 percent from 7.5751 percent. All bids for the 12-month paper were rejected.
The central bank said it sold Rs93.413 billion worth of three-month paper and Rs457.6 billion of the six-month paper.
The State Bank of Pakistan is scheduled to announce its monetary policy decision this month. The SBP kept the policy rate unchanged at 7 percent in May and expected that the monetary policy would remain accommodative in the near term, and any adjustments in the policy rate to be measured and gradual to achieve mildly positive real interest rates over time.
The Consumer Price Index based inflation fell to 8.90 percent in fiscal year 2020/21 from 10.74 percent in the previous year.
The government depends on banks for meeting its financing requirements due to zero borrowing from the State Bank of Pakistan.
The government plans to borrow Rs5.725 trillion from the auctions of T-bills and Pakistan Investment Bonds to fund the budget deficit.
The government has set a fiscal deficit target of Rs3.9 trillion for FY22. So, it is likely to remain dependent on bank borrowing to bridge the deficit.
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