The federal government Wednesday borrowed over Rs 589 billion through the auction for short-term bonds on slightly higher rates. The State Bank of Pakistan (SBP), on February 1, 2017, conducted the auction for sale of 3-, 6- and 12-month Market Treasury Bills (MTBs) and received bids amounting to Rs 742.874 billion with realized/discounted value of Rs 724.334 billion. Some Rs 375.306 billion bids were received for 3-month, Rs 264.25 billion for 6-month and some Rs 103.29 billion bids were submitted for 12-month period.
The cut-off yield of MTBs witnessed an upward trend in the auction held Wednesday while the cut-off yield of all short-term papers increased up to 6 basis points (bps). Out of the received bids, the federal government accepted bids amounting to Rs 604.797 billion with a realized amount of Rs 589.742 billion against the target of Rs 550 billion for this auction. The cut-off yield of 3-month MTBs was fixed at 5.9463 percent, up 4 bps, with accepting bids of Rs 283.395 billion (realized/discounted value). Some Rs 236.216 billion were borrowed against the sale of 6-month T-bills at a cut-off yield of 5.9896 percent, up 6 bps. The cut-off yield of 12-month short-term bonds increased by 3 bps to 5.9935 percent and bids amounting to Rs 70.13 billion were accepted.