KARACHI: The cut-off yields on short-term government bonds increased by up to 41 basis points (bps) in Wednesday’s auction. The State Bank of Pakistan (SBP) conducted the auction for the sale of 1-month, 3-month, 6-month and 12-month Government of Pakistan Market Treasury Bills (MTBs) on October 1 and received bids amounting to Rs 1.494trillion with a realized value of Rs 1.438 trillion.
Most of the bids were received for 1-month treasury bills. The received bids include Rs 793 billion for 1-month, Rs 140.378 billion for 3-month, Rs 210.245billion for 6-month and Rs 350.85 billion for 12-month.
Out of the total bids received, the federal government accepted Rs 730.436 billion (realized value Rs 696.289 billion) against a target of Rs 750 billion and maturities of Rs 846 billion. The accepted amount comprised Rs 612 billion in competitive bids and Rs 84.11 billion in non-competitive bids.
Govt raises Rs491bn via: T-bill, beats target by Rs91bn
The cut-off yield of all T-bills went up ranging between 19 bps to 41 bps in the auction. The cut-off yield of 1-month short term government securities rose by 41 bps to 11.1502 percent compared to 10.7445 percent in the previous auction held on September 17, 2025. The borrowed amount through 1-month T-bills was Rs 318.418 billion (including competitive and non-competitive).
Bids amounting to Rs 56.226billion were accepted for the 3-month MTBs and its cut-off yield set at 11.0499 percent, up by 20 bps. In addition, the cut-off yield of 6-month T-bills increased 21 bps to 11.0499 percent and an amount of Rs 112.438 billion was borrowed.
In addition, margin on 12-months short term government papers surged by 19 bps to 11.1901 percent in the auction held on Wednesday with borrowing amount of Rs 243.353 billion.
In addition, the federal government also borrowed some Rs 246.753 billion through sale of 10 Year Pakistan Investment Bonds (PIBs) - Floating Rate (PFL) Semi Annual. Overall bids worth Rs 394 billion were received for the sale of 10 Year PIBs-PFL Semi Annual with settlement date of Oct 2, 2025.
The Monetary Policy Committee (MPC) of the SBP has kept the policy rate unchanged at 11 percent since May 2025, anticipating a rise in inflation driven mainly by flooding and supply chain disruptions.
Copyright Business Recorder, 2025
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