Treasury bills : SBP borrows Rs232 billion

Banks and other investors expect the benchmark rate to stay unchanged at 14 per cent in the next monetary policy.

KARACHI: The State Bank of Pakistan (SBP) borrowed Rs232.6 billion in an auction of market treasury bills on Wednesday, beating its target of Rs225 billion, show figures released by the central bank.

Banks and other investors invested heavily in six-month bills, expecting the benchmark policy rate to stay unchanged at 14 per cent in the next monetary policy. Investment in these bills totaled Rs168.2 billion at a cut-off yield of 13.62 per cent, which was down from 13.69 per cent in the previous auction held on April 6. In 12-month bills, SBP accepted offers of Rs47.5 billion at a return of 13.87 per cent, unchanged from the previous auction. In three-month papers, the central bank borrowed Rs16.9 billion at a return of 13.25 per cent, down from 13.3 per cent earlier.

Published in The Express Tribune, April 21^st, 2011.