KARACHI, Dec 20: Monetary experts and analysts see no change in the cut-off yields of the Treasury bills auction on Wednesday mainly because of huge liquidity inflow at the time of auction.

The State Bank of Pakistan (SBP), which will auction T-bills on Wednesday, has set Rs45 billion as the target for auction despite an inflow of about Rs76 billion the same day.

Analysts believe that even if the SBP picks up the money as per the target of Rs45 billion, the market would come under pressure of surplus liquidity of about Rs30 billion. They said the SBP can not leave the market full of liquidity as it hurts its own tight monetary policy. The SBP would come immediately with the Open Market Operations (OMO) to sweep liquidity from the market, they said.

Analysts said that the bids might be lower than the prevailing cut-off yield and this could be reflected in the T-bills of one year maturity. “There is no chance for a change in cut-off yields but the presence of huge liquidity could reflect in the low bid offers for the T-bills,” said an analyst.