The government raised a total of Rs518 billion through treasury bills (T-bills) in an auction and non-competitive bids, despite receiving offers worth Rs2.192 trillion, according to the State Bank of Pakistan (SBP).
Commercial banks submitted the bulk of the bids, but the government accepted only Rs237.6bn through the auction. An additional Rs280.3bn was raised through non-competitive bids, marking the first time that such bids exceeded the amount raised through the regular auction.
The higher non-competitive participation was reportedly driven by provincial governments, whose bids for three-month T-bills reached around Rs200bn.
The government raised Rs349.5bn through three-month T-bills, including Rs118.7bn through competitive bids and Rs230.8bn through non-competitive bids.
For 12-month T-bills, the government accepted Rs52.6bn at a yield of 11.99 per cent, while Rs38bn was raised through one-month papers at a yield of 11.46pc.
The strong demand reflects banks’ preference for government securities, considered relatively risk-free, amid limited lending opportunities in the private sector.
Analysts noted that high interest rates have also restricted private-sector borrowing, particularly for long-term investment, while banks continue to channel surplus liquidity into government debt.
The SBP has maintained that economic stabilisation remains a priority over growth, with relatively high interest rates being used to contain inflation.
