KARACHI: The government has raised less than half of its target through the Market Treasury Bill auction on Wednesday.

The State Bank of Pakistan reported the government raised Rs239.7 billion through T-bills, as against the target of Rs500bn.

For the last several auctions, the government has been raising liquidity less than its target amounts, reflecting its fiscal concerns. It has also stopped borrowing from SBP, which was a major source of financing for the past few years.

However, investors were willing to buy more than Rs500bn of security papers as total bids came in at Rs518.2bn. The maturing amount for this auction was Rs175.77bn.

The high-yield T-bills are becoming attractive for foreign investors who have invested more than $800 million in the securities since the start of this fiscal year. The returns of three-, six- and 12-month papers were 13.51 per cent, 13.28pc and 13.24pc, respectively.

In the latest auction, the government raised Rs178.8bn for three-month papers versus bids of Rs222.8bn, which is the highest amount offered for the tenure.

The amount of Rs15.5bn was raised for six-month and Rs45.2bn for the year-long papers.

The returns on T-bills were almost close to the key interest rate of 13.25pc, indicating that the monetary policy which due on Nov 22 may not see any change.

Published in Dawn, November 21st, 2019