KARACHI: The cut-off yields on short-term government bonds increased by up to 39 basis points (bps) in auction held on Wednesday.
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 Wednesday and received bids amounting to Rs 915.454 billion with a realized value of Rs 870.86 billion.
Most of the bids were received for 12-month treasury bills. The received bids include Rs 261.34 billion for 1-month, Rs 181 billion for 3-month, Rs 203 billion for 6-month and Rs 270 billion for 12-month.
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Out of the total bids received, the federal government accepted Rs 581.665 billion against a target of Rs 550 billion and maturities of Rs 475 billion. The accepted amount comprised Rs 336.914 billion in competitive bids and Rs 244.75 billion in non-competitive bids. Of the accepted non-competitive bids, Rs 200 billion were raised by the provincial government bids.
The cut-off yield of all T-bills went up ranging 21.5 bps to 39.3 bps in the auction. The cut-off yield of 1-month short term government securities rose by 34.7 bps to set 10.4955 percent compared to 10.1482 percent in the previous auction held on February 18, 2026. The borrowed amount through 1-month T-bills was Rs 95.113 billion (including competitive and non-competitive).
Bids amounting to Rs 261 billion were accepted for the 3-month MTBs and its cut-off yield set at 10.5001 percent, up by 21.5 bps. In addition, the cut-off yield of 6-month T-bills surgedby29.6 bps to 10.7401 percent and an amount of Rs 71.462 billion was borrowed.
In addition, margin on 12-months short term government papers surged by 39.3 bps to 10.9928 percent in the auction held on Wednesday with borrowing amount of Rs157.799 billion.
It is worth noting that on January 22, 2026, just days before the monetary policy meeting, cut-off yields on Pakistan’s short-term government securities returned to single-digit levels after a four-year gap, as the market largely anticipated a policy rate cut.
Cut-off yields on 3-month and 6-month Treasury Bills slipped back into single-digit territory, a level last seen in November 2021. The 12-month T-bill, however, was cut off slightly higher at around 10 percent in the auction held on January 22, 2026.
Contrary to market expectations, the Monetary Policy Committee (MPC) of the State Bank of Pakistan kept the policy rate unchanged at 10.5 percent in its January meeting, citing a stable inflation outlook and the need to maintain macroeconomic stability.
Copyright Business Recorder, 2026
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