KARACHI: The government raised Rs704 billion from treasury bills on Wednesday, more than double the target set for the auction.

At the same time, the cut-off yields on the treasury bills increased for the short-term three-month and long-term 12-month papers, but the rate for the benchmark six-month bills was kept unchanged.

The State Bank raised Rs541.5bn for the three-month tenor at 21.66 per cent, an increase of 26 basis points. The SBP raised Rs5.3bn at 20.39pc for the six-month tenor. However, the cut-off yield for the 12-month tenor jumped by 60 bps to 20.89pc, while Rs102.5bn was raised for this paper.

The total bids offered by the investors were Rs992.4bn for the auction.

The increase in the treasury bills was introduced after the monetary policy was announced on March 18. The market was expecting a cut in the interest rate, but the State Bank said there was still a risk of high inflation, which compelled the bank to remain cautious and leave the rate unchanged at 22pc.

Published in Dawn, March 21st, 2024