KARACHI, Oct 12: The State Bank on Wednesday sucked in Rs4.527 billion through auction of three-, six- and 12-month treasury bills and kept the cut-off yield on the papers unchanged.

Market experts were expecting an increase in the cut-off yield on 6-month paper in the wake of rising inflation and higher interest rates.

The weighted average annual yield on 6-month and three-month TBs also remained unchanged at 8.1388 and 8.1 per cent, while the yield on 12-month paper showed a slight increase to 8.7907 from 8.7896 per cent.

The SBP accepted bids of Rs3.386 billion for three-month paper, Rs240 million for six-month and Rs644 million for 12-month bills. The SBP remained below the auction target of Rs5 billion.

Analysts said that the money market still short of Rs10 billion despite the SBP’s injection of Rs19.2 billion on Monday through open market operation (reverse repo).

The overnight rate touched the peak of 8.9 per cent which reflected that the market was still facing tight liquidity position. Analysts believe the shortage will persist unless the SBP injects liquidity into the system.