Karachi: The State Bank of Pakistan (SBP) on Monday (November 29) announced the generation of PKR 117 billion from the auction of Pakistan Investment Bonds (PIBs), news sources reported. The central bank received bids of PKR 288 billion against the set target of PKR 100 billion.
As per the reports, the higher investment in PIB has followed the hike in interest rates by 150 base points to 8.75% in the last week of November by the central bank. The investor’s bids are higher as the market speculate a further rise in interest rates in the coming months. In addition to this, the government has also raised the cut-off yield of 3 years’ PIB by 246 basis points to 11.34% raising a total of PKR 25 billion. While the cut-off yield for the 5-year paper was raised by 241 basis points to 11.59% raising a total of PKR 56.45 billion.
Similarly, for 10 year’s PIB’s policy rate was hiked by 196 basis points to 11.79% raising PKR 35.5 billion. The central bank also clarified that the change in the monetary policy followed unprecedented circumstances faced by the economy amidst the pandemic. The change in policy is focused on giving the economy ample space to absorb the shock and reduce the impact on common people.
Nauman Ahmad is an imaginative Pisces whose love for literature and nature is unparalleled. When he's not reading or hiking, he's sleeping and eating, which gives him plenty of energy for his next adventure.
