KARACHI:
The government raised more than Rs1.03 trillion on Wednesday through auctions of treasury bills, Pakistan Investment Bonds (PIB) and the Government Ijara Sukuk (GIS). The State Bank of Pakistan (SBP) conducted the three auctions, which attracted strong investor participation across conventional and Islamic instruments.
In the T-bill auction, the SBP targeted Rs650 billion but received an overwhelming response as bids totalled Rs1.803 trillion. It accepted Rs749 billion across all four tenors. The one-month paper attracted the highest bids of Rs648 billion against the target of Rs100 billion, though only Rs61 billion was accepted at a cut-off yield of 10.89%, slightly lower than the previous auction. The three-month T-bill saw bids of Rs211 billion against the target of Rs150 billion, with Rs251 billion accepted at a stable cut-off yield of 11%.
For the six-month tenor, bids amounted to Rs177 billion versus the target of Rs200 billion, but acceptance was restricted to Rs69 billion, also at 11% cut-off yield. The 12-month paper received a substantial Rs767 billion in bids, of which Rs368 billion was accepted at a cut-off yield of 11.27%.
Yields across all tenors registered minor downward adjustments compared to the previous auction and the secondary market, indicating continued confidence in short-term government securities. In the PIB segment, the government raised Rs28 billion through the 10-year Pakistan Floating Rate Semi-Annual (PFL-SA) bond against total bids of Rs524 billion and the target of Rs50 billion. The cut-off price was 95.4, reflecting a cut-off rate of 11.70% with a spread of 0.80% over the benchmark.
Separately, the SBP conducted the outright purchase of the Government Ijara Sukuk (GIS) VRR-22 on a deferred payment (Bai Muajjal) basis. Against the offered face value of Rs176.43 billion, the government accepted Rs175.16 billion at a Bai Muajjal cut-off price of 144.97. The total deferred payment obligation amounted to Rs253.93 billion. The Sukuk continued to draw strong demand from Sharia-compliant investors.
The Pakistani rupee edged up slightly against the US dollar, closing at 280.56 in the inter-bank market, a gain of Rs0.01. The local unit had ended Tuesday at 280.57. Meanwhile, gold prices in Pakistan rose, tracking gains in the international market. The price per tola increased by Rs2,300 to Rs438,862, while 10-gram gold climbed Rs1,972 to Rs376,253, according to the All-Pakistan Gems and Jewellers Sarafa Association. International prices were up $23 at $4,165 per ounce.
