Karachi, January 7, 2026 — The State Bank of Pakistan (SBP) on Wednesday raised Rs905 billion through the auction of Market Treasury Bills (MTBs), surpassing its initial target of Rs850 billion, reflecting strong investor participation and easing yield expectations.
According to official data, the central bank received bids amounting to nearly Rs2.4 trillion across all tenors, including 1-month, 3-month, 6-month, and 12-month treasury bills. The sizeable oversubscription highlights sustained liquidity in the banking system and confidence in short-term government securities.
Yields across all maturities declined notably compared to the previous auction. The cut-off yield on the 1-month paper dropped by 29 basis points, while the 3-month tenor saw a sharper fall of 34 basis points. Similarly, yields on the 6-month and 12-month papers decreased by 32 basis points and 33 basis points, respectively. Market participants attributed the decline to expectations of stable monetary policy and moderating inflation trends.
The SBP regularly conducts treasury bill auctions to help the federal government meet its financing needs, particularly for managing the budget deficit and short-term cash requirements. These auctions also serve as a key indicator of market sentiment regarding interest rates and liquidity conditions.
In the latest auction, the largest portion of funds was mobilized through the 12-month paper, with the central bank raising Rs691 billion. Meanwhile, Rs86 billion was secured through 1-month bills, Rs78 billion from 3-month papers, and Rs49 billion from the 6-month tenor.
Analysts believe the lower yields and robust demand may influence future borrowing costs and signal easing pressure in Pakistan’s money market.