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Government Raises 1,092 Billion Rupees via Treasury Bills

In a recent auction held by the State Bank of Pakistan (SBP), the cut-off yields on Treasury Bills (T-Bills) exhibited a remarkable decline, with rates dropping by up to 45 basis points (bps). This development has garnered significant attention from investors and financial experts alike. In this article, we delve into the details of this auction and explore the implications of this substantial yield reduction.


The State Bank of Pakistan’s auction of Treasury Bills is a pivotal event in the country’s financial landscape. It not only indicates the government’s borrowing activities but also provides valuable insights into the overall economic conditions. The most recent auction revealed a substantial decrease in cut-off yields, raising questions about the factors driving this change.

The Auction Overview

Let’s begin by examining the key details of the auction:

Raising Funds

The government’s goal for this auction was to raise Rs. 900 billion, a substantial target. However, the actual amount raised surpassed expectations, totaling a significant Rs. 1,092 billion. This surplus is a strong indicator of investor confidence in T-Bills.

Maturity Amount

In addition to raising funds, the government also had a maturity of Rs. 783 billion in the auction. This maturity adds another layer of complexity to the auction’s dynamics, impacting the government’s overall financial strategy.

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Yield Reduction

One of the most noteworthy aspects of this auction was the substantial reduction in cut-off yields across various T-Bill tenures:

3-Month T-Bills

The cut-off yield for the 3-month T-Bills witnessed a 30 bps drop, settling at 22.2000 percent. This decrease indicates a considerable decline in short-term borrowing costs for the government.

6-Month T-Bills

For the 6-month T-Bills, the cut-off yield experienced an even more significant decrease, falling by 45 bps to 22.3999 percent. This reduction presents a compelling case for medium-term investors.

12-Month T-Bills

The most extended tenure, the 12-month T-Bills, also saw a substantial reduction in the cut-off yield, decreasing by 44 bps to 22.4000 percent. This development signifies a more attractive option for long-term investors.

Competitive Auction Results

In the competitive auction segment, the government raised funds as follows:

  • Rs. 39 billion for the 3-month T-Bills.
  • Rs. 12 billion for the 6-month T-Bills.
  • Rs. 882 billion for the 12-month T-Bills.

These results illustrate the diverse investor appetite for T-Bills with varying tenures.

Non-Competitive Bids

The government also successfully raised Rs. 159 billion through non-competitive bids. This non-competitive segment provides investors with a guaranteed allotment of T-Bills at the market-determined yield, promoting inclusivity in government securities.

A Strong Finish

The total amount raised during the auction, standing at Rs. 1,092 billion, showcases the strength of the T-Bill market in Pakistan and the government’s ability to meet its financial needs effectively.


The significant drop in T-Bill yields has several implications for investors and the economy:

  • Investor Confidence: The strong response to the auction and the oversubscription of T-Bills signal a high level of investor confidence in Pakistan’s economic prospects.
  • Borrowing Costs: With reduced yields, the government can access financing at a lower cost, which can positively impact the country’s fiscal health.
  • Investment Opportunities: Lower yields on T-Bills may prompt investors to explore alternative investment avenues, potentially boosting the stock market and other financial instruments.
  • Economic Growth: The government’s ability to secure financing at a lower cost can lead to increased spending on infrastructure and social programs, potentially stimulating economic growth.


The recent Treasury Bills auction by the State Bank of Pakistan showcased a significant decrease in cut-off yields, indicating robust investor confidence and potentially positive economic outcomes. These developments are essential for understanding the dynamics of Pakistan’s financial landscape and its implications for investors and the broader economy.


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