Qudsia Bano

The Government of Pakistan has mobilized more than Rs 940 billion through its latest debt auctions as the State Bank of Pakistan (SBP) successfully raised Rs 696 billion via Market Treasury Bills (MTBs) and Rs 247 billion through Pakistan Investment Bonds (PIBs) on October 1, 2025. The results reflect sustained investor confidence in government securities and underline the authorities’ efforts to manage short- and medium-term financing requirements efficiently.

According to data released by the SBP, the auction of Market Treasury Bills attracted a strong response from banks and institutional investors. Bids were invited for one-month, three-month, six-month and twelve-month maturities, with total offers amounting to Rs 1.43 trillion against a face value of Rs 1.49 trillion. Out of this, Rs 612.17 billion were accepted as competitive bids, while another Rs 84.11 billion were raised through non-competitive participation, bringing the overall accepted amount for the MTB auction to Rs 696.28 billion.

The one-month tenor drew the highest investor interest, generating Rs 307.58 billion at a cut-off yield of 11.1502 percent and a weighted average yield of 11.0915 percent. The twelve-month paper also saw robust demand, raising Rs 198.79 billion at a cut-off yield of 11.1901 percent and a weighted average yield of 11.1264 percent. Meanwhile, the three-month and six-month bills added Rs 42.44 billion and Rs 63.34 billion respectively, both priced at a cut-off yield of 11.0499 percent.

Non-competitive bids further supplemented the total, with the six-month tenor securing Rs 43.33 billion, followed by Rs 20.25 billion in the twelve-month category, Rs 12.38 billion in the three-month paper and Rs 8.14 billion in the one-month bills. Alongside the Treasury Bill auction, the central bank conducted a sale of long-term government debt through Pakistan Investment Bonds, specifically ten-year floating rate instruments with semi-annual returns.

The PIB auction attracted offers worth Rs 394 billion in a price range of 95.1527 to 93.7286. Out of this, the SBP accepted Rs 244 billion in face value, translating into a realized amount of Rs 231.06 billion, while accrued interest contributed another Rs 6.07 billion. The total realized amount for PIBs reached Rs 237.13 billion, and when non-competitive bids of Rs 2.75 billion were included, the final acceptance climbed to Rs 246.75 billion.

Market observers view the auction results as evidence of strong demand for short-term government debt, particularly the one-month and twelve-month securities, driven by expectations of monetary stability and a potentially more accommodative rate outlook.

Credit: INP-WealthPk