T-Bill Auction Earns Rs. 618 Billion With Cut-Off Yield Down by 14 Points

The government has once again slashed the cut-off yields on the benchmark six-month treasury bills (T-bills), as it raised more than Rs. 600 billion in another auction.

The government has raised Rs. 617.8 billion in an auction held on Wednesday.

The cut-off yield on the six-month T-bills was slashed by 14 basis points to raise Rs. 299.4 billion, while for three-month T-bills, the cut-off yield was reduced by 5bps to 7.35 percent to raise Rs. 232.3 billion.


Earlier, in the auction held on April 21, the rate was slashed by 11bps.

The bidding results showed that liquidity was amply present, but there were not many opportunities for banks to invest. The pandemic and the resulting reduction in consumption has led to an increase in banks’ deposits without offering equivalent opportunities for investment, a report by the State Bank of Pakistan (SBP) showed.

Total bids received by the government for the current auction stood at Rs. 1,618 billion. The government accepted Rs. 617.8 billion out of this, including Rs. 61.2 billion raised through non-competitive bids.

For six-month tenure papers, the government received bids of Rs. 906.13 billion, and for three-month tenure papers, it received bids of Rs. 558.3 billion.

The lowest bids were received for 12-month tenure papers, of Rs. 154 billion, out of which the government accepted Rs. 25 billion at the rate of 7.69 percent.

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