The central bank further reduced rates on the fresh issue of Pakistan Investment Bonds on December 17. Nonetheless, the auction witnessed strong participation by banks.
The government managed to raise Rs158.531bn from the auction. Of this, three-year PIBs fetched Rs95.492bn at a cut-off yield of 10.5979pc, followed by 10-year PIBs with Rs37.574bn at 11.7049pc and five-year PIBs with Rs25.463bn at 10.7994pc.
Interestingly, despite facing liquidity issues until the prior week, banks and other financial institutions bid the second-highest amount of funds during the auction — Rs115.809bn — for longer tenured (10-year) bonds.
Three-year PIBs had attracted Rs166.897bn, followed by five-year PIBs with Rs70.805bn and 20-year PIBs with Rs273m. Bids for 20-year bonds were rejected by the central bank.
