KARACHI, March 5: As an indication of softening of prevailing tight monetary policy, the State Bank on Monday reduced the cut-off yields on all maturities of Pakistan Investment Bonds (PIBs).

Dealers said the heavy participation by banks at lower returns was another proof that market punters were expecting easing of interest rates in upcoming months. However, the SBP remained stick to its auction target and picked up only Rs15.189 billion out of the total bids worth Rs55.787 billion.

The cut-off yield on 10-year PIB slipped from 10.52pc to 10.19 per cent, for 15-year from 11.10pc to 10.98pc, for five-year from 10pc to 9.76pc and for three-year from 9.73pc to 9.36 per cent.

The State Bank rejected all bids for the 20 and 30 years.