KARACHI, March 15: The State Bank on Wednesday siphoned off liquidity four times higher than its target for auction of treasury bills but no change was noted in cut-off yield of the bills.

The SBP realized Rs25.003 billion through the auction of 12-month, six-month and three-month T-bills against the target of Rs6 billion. Dealers said that the inflow of Rs33 billion was scheduled for March 16.

They maintained that the market was still liquid despite outflow of huge amount which kept the overnight rate moderate, preventing the rate to touch the highest level of 8.9pc. The overnight rate was 7.25pc to 7.5 per cent at the closing of the market.

Dealers said the volume of auction was up to the expectation of the market. They said the market was not expecting change in the cut-off yield because of the SBP’s tight monetary policy.

However, market was expecting OMO on Thursday for tightening of overnight rate.

The cut-off yield on benchmark six-month T-bills remained at 8.2910 per cent. The cut-off yield on three-month and 12-month also remained unchanged.

The SBP sold Rs2.881bn of six-month T-bills, Rs9.066bn of 3-month and Rs13.056bn of 12-month bills. The SBP received total bids of Rs34.785bn, which shows that the market still has a liquidity of about Rs8bn which may invite OMO on Thursday.