KARACHI: State Bank of Pakistan (SBP) on Monday kept the benchmark key policy rate unchanged at 15 per cent owing to deceleration in economic activity and contraction in headline inflation.

The SBP said that the Monetary Policy Committee (MPC) decided to maintain the policy rate at 15 per cent. The MPC noted the continued deceleration in economic activity as well as the decline in headline inflation and the current account deficit since the last meeting.

READ MORE: SBP keeps benchmark rate unchanged at 15% amid rising inflation

It also noted that the recent floods have altered the macroeconomic outlook and a fuller assessment of their impact is underway. Based on currently available information, the MPC was of the view that the existing monetary policy stance strikes an appropriate balance between managing inflation and maintaining growth in the wake of the floods.

On the one hand, inflation could be higher and more persistent due to the supply shock to food prices, and it is important to ensure that this additional impetus does not spillover into broader prices in the economy.

READ MORE: Poll sees no policy rate change in August 22, 2022 meeting

On the other, growth prospects have weakened, which should reduce demand-side pressures and suppress underlying inflation. In light of these offsetting considerations, the MPC considered it prudent to leave monetary policy settings unchanged at this stage.

Since the last meeting, the MPC noted several key developments. First, the desired moderation in economic activity has become more visible and entrenched, signaling that the tightening measures implemented over the last year are gaining traction.

With growth likely to slow further in the aftermath of the floods, this tightening will need to be carefully calibrated going forward. Second, after peaking in August as expected, headline inflation fell last month due to an administrative cut in electricity prices. However, core inflation continued to drift upwards in both rural and urban areas.

READ MORE: Pakistan hikes key policy rate by 125 basis points to 15%

Third, the current account and trade deficits narrowed significantly in August and September, respectively, and the Rupee has recouped some of its losses following the recent depreciation. Fourth, the combined 7th and 8th review under the on-going IMF program was successfully completed on August 29th, releasing a tranche of $1.2 billion.

The MPC discussed the post-flood macroeconomic outlook, noting that projections are still preliminary and would become firmer after the flood damage assessment being conducted by the government is finalized. Based on currently available information, GDP growth could fall to around 2 percent in FY23, compared to the previous forecast of 3-4 percent before the floods.

Meanwhile, higher food prices could raise average headline inflation in FY23 somewhat above the pre-flood projection of 18-20 percent. The impact on the current account deficit is likely to be muted, with pressures from higher food and cotton imports and lower textile exports largely offset by slower domestic demand and lower global commodity prices. As a result, any deterioration in the current account deficit is expected to be contained, still leaving it in the vicinity of the previously forecast 3 percent of GDP.

The economy has slowed considerably since the last MPC meeting. Most demand indicators were lower in both July and August than in the same period last year—including sales of cement, POL, and automobiles. On the supply side, electricity generation declined for the third consecutive month in August, falling by 12.6 percent (y/y).

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In July, LSM declined by 1.4 percent (y/y), its first contraction in two years, largely driven by broad-based deterioration in domestically-oriented sectors. Looking ahead, the recent floods are likely to adversely affect the output of cotton and rice as well as the livestock sector this year.

The current account deficit shrank for the second consecutive month in August to only $0.7 billion, almost half the level in July. In September, PBS data shows that the trade deficit contracted sharply by 19.7 percent (m/m) and 30.6 percent (y/y) to reach $2.9 billion, reflecting a decline in both energy and non-energy imports amid stable exports. During the first quarter of FY23, imports have declined by 12.7 percent (y/y) to $18.7 billion while exports have grown by 1.8 percent (y/y) to $7 billion. Looking ahead, the floods are likely to result in greater need for some agricultural imports such as cotton and a few perishable food items.

At the same time, exports of rice and textiles are likely to be negatively affected. However, these adverse impacts could to a large extent be offset by downward pressures on the import bill from lower domestic growth and falling global commodity prices and shipping costs. In addition, as experienced after previous natural disasters in Pakistan, the impact on the current account could be further cushioned by international assistance in the form of current transfers. Given secured external financing and additional commitments in the wake of the floods, FX reserves should improve through the course of the year.

In July, fiscal outcomes were better than in the same period last year. The fiscal deficit fell to 0.3 percent of GDP while the primary balance recorded a surplus of 0.2 percent of GDP. This improvement was largely due to higher FBR tax revenues as well as a decline in government spending. During the first quarter, FBR tax collection rose to Rs 1.625 trillion, surpassing the target by Rs 27 billion.

While the floods could make it challenging to achieve the planned fiscal consolidation this year, the government has so far been able to meet urgent spending needs through re-allocation and re-appropriations of budgeted funds.

Looking ahead, additional foreign inflows, including in the form of grants, should help fund any fiscal slippages. Beyond the current year, reconstruction and rehabilitation will necessitate additional spending over the medium-term, with assistance from the international community.  

In line with slowing economic activity, private sector credit has seen a net retirement of Rs 0.7 billion so far this fiscal year, compared to an expansion of Rs 62.6 billion during the same period last year. This decline in credit mainly reflects a retirement of working capital loans and a sharp fall in consumer finance.

After peaking in August, headline inflation fell by more than 4 percentage points in September to 23.2 percent (y/y), driven by a reduction in electricity prices due to an administrative intervention. At the same time, the momentum of inflation also slowed by more than expected, declining by 1.2 percent (m/m). On the other hand, both core and food inflation picked up further. Looking ahead, the supply-shock to food prices from the floods is expected to put additional pressure on headline inflation in the coming months.

Nevertheless, headline inflation is still projected to gradually decline through the rest of the fiscal year, particularly in the second half.

Thereafter, it should fall towards the upper range of the 5-7 percent medium-term target by the end of FY24. A continuation of prudent monetary policy and orderly movements in the Rupee should help contain core inflation going forward.

At the same time, curbing food inflation through administrative measures to resolve supply-chain bottlenecks and any necessary imports should be a high priority. The MPC will continue to carefully monitor developments affecting medium-term prospects for inflation, financial stability, and growth.

KARACHI: The central bank of Pakistan on Thursday announced to hike policy rate by 125 basis points to 15 per cent from 13.75 per cent.

The SBP in a statement said that at today’s (July 07, 2022) meeting, the Monetary Policy Committee (MPC) decided to raise the policy rate by 125 basis points to 15 percent.

In addition, as foreshadowed in the last monetary policy statement, the interest rates on EFS and LTFF loans are now being linked to the policy rate to strengthen monetary policy transmission, while continuing to incentivize exports by presently offering a discount of 500 basis points relative to the policy rate.

READ MORE: Pakistan may see further 100bps hike in policy rate

This combined action continues the monetary tightening underway since last September, which is aimed at ensuring a soft landing of the economy amid an exceptionally challenging and uncertain global environment. It should help cool economic activity, prevent a de-anchoring of inflation expectations and provide support to the Rupee in the wake of multi-year high inflation and record imports.

Since the last meeting, the MPC noted three encouraging developments. First, the unsustainable energy subsidy package was reversed and an FY23 budget centered on strong fiscal consolidation was passed. This has paved the way for completion of the on-going review of the IMF program, which will ensure that tail risks associated with meeting Pakistan’s external financing needs are averted.

Second, a $2.3 billion commercial loan from China helped provide support to FX reserves, which had been falling since January due to current account pressures, external debt repayments and paucity of fresh foreign inflows. Third, economic activity remains robust, with the momentum of the last two years of near 6 percent growth carrying into the start of FY23. As a result, Pakistan faces a significantly lower trade-off between growth and inflation than many countries where the post-Covid recovery has not been as vigorous.

READ MORE: SBP increases interest rate by 150bps to 13.75%

However, several adverse developments have overshadowed this positive news. Globally, inflation is at multi-decade highs in most countries and central banks are responding aggressively, leading to depreciation pressure on most emerging market currencies. This strong monetary tightening has occurred despite concerns about a slowdown in global growth and even recession risks, highlighting the primacy that central banks are placing on containing inflation at this juncture. Domestically, as energy subsidies were reversed, both headline and core inflation increased significantly in June, rising to a 14-year high. Inflation expectations of consumers and businesses also rose markedly. At the same time, the current account deficit unexpectedly spiked in May and the trade deficit continued its post-March widening trend to reach a 7-month high in June, on burgeoning energy imports. As a result, FX reserves and the Rupee remained under pressure, further worsening the inflation outlook.

Against this challenging backdrop, the MPC noted the importance of strong, timely and credible policy actions to moderate domestic demand, prevent a compounding of inflationary pressures and reduce risks to external stability. Like most of the world, Pakistan is facing a large negative income shock from high inflation and necessary but difficult increases in utility prices and taxes. Without decisive macroeconomic adjustments, there is a significant risk of substantially worse outcomes that would compromise price stability, financial stability and growth.

READ MORE: SBP may increase key policy rate by 100bps: poll

This could take the form of runaway inflation, FX reserve depletion and the need for sudden and aggressive tightening actions later that would be significantly more disruptive for economic activity and employment. Adjustment is difficult but necessary in Pakistan, as it is all over the world.

However, in the interest of social stability, the burden of this adjustment must be shared equitably across the population, by ensuring that the relatively well-off absorb most of the increase in utility prices and taxes while well-targeted and adequate assistance is provided to the more vulnerable.

Under the MPC’s baseline outlook, headline inflation is likely to remain elevated around current levels for much of FY23 before falling sharply to the 5-7 percent target range by the end of FY24, driven by tight policies, normalization of global commodity prices, and beneficial base effects. While risks exist on both sides, those of significantly higher inflation dominate, prompting today’s rate increase. Going forward, the MPC will remain data-dependent, paying particularly close attention to month-on-month inflation, the evolution of inflation expectations and global commodity prices, as well as developments on the fiscal and external fronts.

READ MORE: Policy rate may rise as T-Bill yields increase sharply

Pakistan’s strong economic rebound from Covid continues, with the level of output surpassing pre-pandemic levels, unlike in many other emerging markets. The needed moderation in economic activity that was occurring through FY22 in response to monetary tightening has stalled in the last three months, fueled by an unwarranted fiscal expansion. Most demand indicators suggest robust growth since the last MPC—sales of cement, POL and automobiles increased month-on-month—and growth in LSM remains high. Looking ahead, growth is expected to moderate to 3-4 percent in FY23, on the back of monetary tightening and fiscal consolidation, helping to close the positive output gap and diminish demand-side pressures on inflation. This will pave the way for higher growth on a more sustainable basis.

After moderating in the previous three months, the current account deficit rose to $1.4 billion in May, on the back of lower exports and remittances partly due to the Eid holiday. Based on PBS data, the trade deficit rose to $4.8 billion in June, more than $1.7 billion higher than its February low. While non-energy imports have continued to moderate in the last three months on the back of curtailment measures by the government and the SBP, this decline has been more than offset by the significant increase in energy imports, which rose from a low of $1.4 billion in February to an estimated record high of $3.7 billion in June. While this partly reflects higher prices, significantly higher volumes of petroleum also played a significant role. Without prompt additional measures to curtail energy imports—for instance through early closure of markets, reduced electricity use by residential and commercial customers, and greater encouragement of work from home and car pooling—containing the trade deficit could become challenging. With such measures, the current account deficit is projected to narrow to around 3 percent of GDP as imports moderate with cooling growth, while exports and remittances remain relatively resilient. The expected completion of the on-going IMF review will catalyze important additional funding from external sources that will ensure that Pakistan’s external financing needs during FY23 are met. Pressures on the Rupee should then attenuate and SBP’s FX reserves should gradually resume their previous upward trajectory during the course of FY23.

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The fiscal stance in FY22 was unexpectedly expansionary, with the primary deficit estimated at 2.4 percent of GDP, double that of the previous year and more than thrice the budgeted primary deficit of 0.7 percent of GDP. To compensate for this unwarranted fiscal impulse, this year’s budget targets a primary surplus of 0.2 percent of GDP, on the back of significantly higher tax revenue. This consolidation is appropriate given the very rapid economic growth rate of the previous two years and the need to ensure debt sustainability amid high gross financing needs due to the relatively short maturity of Pakistan’s domestic debt. It is critical that the envisaged fiscal consolidation is delivered.

It would allow monetary and fiscal policy to resume the well-coordinated approach that characterized Pakistan’s successful Covid response in FY20 and FY21, which supported growth while preserving fiscal and external buffers. At the same time, it is important that the new taxation measures are progressive. In particular, their burden should mainly be absorbed by the relatively better off while adequate protection is provided to the more vulnerable, for whom high food prices are a particular concern. In this context, curbing food inflation through supply-side measures aimed at boosting output and resolving supply-chain bottlenecks should be high priority.

In nominal terms, private sector credit grew by a further 2 percent (m/m) in May, driven by favorable developments in sectors like power, edible oil, construction-allied industries, as well as wholesale and retail trade. Demand for fixed investment and consumer loans also picked up, reflecting robust economic activity. Since the last MPC meeting, secondary market yields and cut-off rates in the government’s auctions have ticked up in the wake of the high inflation reading in June.

Headline inflation rose significantly from 13.8 percent (y/y) in May to 21.3 percent in June, the highest since 2008. The increase was broad-based—with energy, food and core inflation all rising significantly—and more than 80 percent of the items in the CPI basket experiencing inflation of above 6 percent. Strong domestic demand and second-round effects of supply shocks are reflected in the rise of core inflation to 11.5 percent in urban areas and 13.5 percent in rural areas.

At the same time, measures of both short and long-term inflation expectations continue to tick up. Despite the dampening effect of fiscal and monetary tightening on demand-pull inflation, inflation is likely to remain elevated around current levels for much of FY23 due to the large supply shock associated with the necessary reversal of fuel and electricity subsidies. As a result, inflation during FY23 is forecast at around 18-20 percent before declining sharply during FY24. This baseline outlook is subject to significant uncertainty, with risks arising from the path of global commodity prices, the domestic fiscal policy stance, and the exchange rate.

The MPC will continue to carefully monitor developments affecting medium-term prospects for inflation, financial stability, and growth and will take appropriate action to safeguard them.

KARACHI: The State Bank of Pakistan (SBP) on Monday raised the benchmark interest rate by 150 basis points to 13.75 per cent from 12.25 per cent following the announcement made by the Monetary Policy Committee (MPC).

The SBP said that in today’s meeting, the Monetary Policy Committee (MPC) decided to raise the policy rate by 150 basis points to 13.75 percent. This action, together with much needed fiscal consolidation, should help moderate demand to a more sustainable pace while keeping inflation expectations anchored and containing risks to external stability.

Since the last MPC meeting, provisional estimates suggest that growth in FY22 has been much stronger than expected. Meanwhile, external pressures remain elevated and the inflation outlook has deteriorated due to both home-grown and international factors.

READ MORE: SBP may increase key policy rate by 100bps: poll

Domestically, an expansionary fiscal stance this year, exacerbated by the recent energy subsidy package, has fueled demand and lingering policy uncertainty has compounded pressures on the exchange rate. Globally, inflation has intensified due to the Russia-Ukraine conflict and renewed supply disruptions caused by the new Covid wave in China. As a result, almost all central banks across the world are suddenly confronting multi-year high inflation and a challenging outlook.

After contracting by 0.9 percent in FY20 in the wake of Covid, the economy has rebounded much more strongly than anticipated, growing by 5.7 percent last year and accelerating to 5.97 percent this year, as per provisional estimates. At 13.4 percent (y/y), headline inflation unexpectedly rose to a two-year high in April and has now been in double digits for six consecutive months. Inflation momentum was also elevated, at 1.6 percent (m/m), and core inflation rose further to 10.9 and 9.1 percent in rural and urban areas, respectively. On the external front, notwithstanding some encouraging moderation in the current account deficit during April, the Rupee depreciated further due both to domestic uncertainty as well as recent strengthening of the US dollar in international markets following tightening by the Federal Reserve.

READ MORE: SBP may raise policy rate by 100bps to 13.25%

The MPC’s baseline outlook assumes continued engagement with the IMF, as well as reversal of fuel and electricity subsidies together with normalization of the petroleum development levy (PDL) and GST taxes on fuel during FY23. Under these assumptions, headline inflation is likely to increase temporarily and may remain elevated throughout the next fiscal year. Thereafter, it is expected to fall to the 5-7 percent target range by the end of FY24, driven by fiscal consolidation, moderating growth, normalization of global commodity prices, and beneficial base effects.

Considering the balance of risks around this baseline, the MPC felt it was important to take effective action to anchor inflation expectations and maintain external stability. In addition to today’s policy rate increase, the interest rates on EFS and LTFF loans are also being raised. Going forward, to strengthen monetary policy transmission, these rates will be linked to the policy rate and will adjust automatically, while continuing to remain below the policy rate in order to incentivize exports. At the same time, the MPC emphasized the urgency of strong and equitable fiscal consolidation to complement today’s monetary tightening actions. This would help alleviate pressures on inflation, market rates and the external account.

READ MORE: Policy rate may rise as T-Bill yields increase sharply

Unlike most emerging markets, Pakistan experienced a relatively mild contraction after the Covid shock in 2020, followed by a sustained and vigorous rebound. As a result, output is now above its pre-pandemic trend, such that tightening of macroeconomic policies that is necessitated by the presently elevated pressures on inflation and the current account is also warranted from the perspective of demand management.

Most demand indicators have remained strong since the last MPC—including sales of POL and automobiles, electricity generation, and sales tax on services—and growth in LSM accelerated in March. Both consumer and business confidence have also ticked up. With the output gap now positive, the economy would benefit from some cooling. On the back of monetary tightening and assumed fiscal consolidation, growth is expected to moderate to 3.5-4.5 percent in FY23.

READ MORE: State Bank enhances frequency of MP reviews to eight

The current account deficit continues to moderate. In April, it fell to $623 million, less than half the average for the current fiscal year, on the back of lower imports and record remittances. Based on PBS data, the trade deficit shrank by 24 percent relative to its peak last November. These developments are in line with SBP’s projected current account deficit of around 4 percent of GDP this year. Next year, the current account deficit is projected to narrow to around 3 percent of GDP as import growth continues to slow with moderating demand and the recent measures taken by the government to curtail non-essential imports, while exports and remittances remain resilient.

This narrowing of the current account deficit together with continued IMF support will ensure that Pakistan’s external financing needs during FY23 are more than fully met, with an almost equal share coming from rollovers by bilateral official creditors, new lending from multilateral creditors, and a combination of bond issuances, FDI and portfolio inflows. As a result, excessive pressure on the Rupee should attenuate and SBP’s FX reserves should resume their previous upward trajectory during the course of the next fiscal year.

Instead of the budgeted consolidation, the fiscal stance in FY22 is now expected to be expansionary. At 0.7 percent of GDP, the primary deficit during the first three quarters of the year compares unfavorably with the primary surplus of 0.8 percent of GDP during the same period last year. This slippage was driven by a sharp rise in non-interest expenditures, led by higher subsidies, grants and provincial development expenditures. The resulting demand pressures have coincided with the sharp rise in costs from the surge in global commodity prices, exacerbating inflationary pressures and the import bill.

Timely action is needed to restore fiscal prudence, while providing adequate and targeted social protection to the most vulnerable. Such prudence enabled Pakistan’s public debt to decline from 75 percent of GDP in FY19 to 71 percent in 2021 despite the Covid shock, in sharp contrast to the average increase of around 10 percent of GDP across emerging markets over the same period.

READ MORE: Key policy rate goes up to 9.75%; SBP raises 250bps in less than month

In nominal terms, private sector credit growth remained robust through April, reflecting strong economic activity and higher input prices which have enhanced working capital requirements of firms. Since the last MPC meeting, secondary market yields, benchmark rates and cut-off rates in the government’s auctions have risen, particularly at the short end. The MPC noted that the market rates should be aligned with the policy rate and in case of any misalignment after today’s policy decision, SBP would take appropriate action.

Headline inflation rose from 12.7 percent (y/y) in March to 13.4 percent in April, driven by perishable food items and core inflation. The rise in core inflation reflects strong domestic demand and second-round effects of supply shocks. At the same time, measures of long-term inflation expectations have also ticked up. As electricity and fuel subsidies are reversed, inflation is likely to rise temporarily and may remain elevated through FY23 before declining sharply during FY24. This baseline outlook is subject to risks from the path of global commodity prices and the domestic fiscal policy stance. The MPC will continue to carefully monitor developments affecting medium-term prospects for inflation, financial stability, and growth.

KARACHI: The State Bank of Pakistan (SBP) may increase key policy rate by 100 basis points in the upcoming monetary policy announcement (MPS) on May 23, 2022.

Topline Research conducted a poll from leading fund managers to assess their views on country’s economic outlook. Questions were asked on interest rate, inflation, currency, GDP growth and current account deficit outlook.

READ MORE: SBP may raise policy rate by 100bps to 13.25%

The SBP in the last monetary policy announcement on April 7, 2022 raised the policy rate by 250 basis points to 12.25 per cent.

Since the last Monetary Policy Statement (MPS) on April 7, 2022, secondary market rates including Treasury-Bill/Kibor rates have gone up by around 200 basis points due to uncertainty on removal of subsidies on petrol/diesel and continuation of IMF program.

It will also be interesting to see SBP’s stance as this will be the first monetary policy statement (MPS) after recent change in government and appointment of Dr. Murtaza Syed as new acting Governor SBP.

Interestingly in the latest T-Bill auction, cut-off yields declined for the first time after almost an year declining by 5-29bps with 3/6/12 T-Bills yields clocking in at 14.49 per cent, 14.70 per cent, and 14.75 per cent respectively.

READ MORE: Policy rate may rise as T-Bill yields increase sharply

As per the survey results, around 54 per cent of the participants expects an increase of 100bps, 14 per cent of the participants anticipate an increase of 150bps and 11 per cent expect an increase of 200bps or more. On other hand, only 13 per cent participants expect increase of 50bps while 9 per cent expect no change.

Participants remained divided on policy rate expectations by end of fiscal year 2022/2023. About 27 per cent of the participants expect policy rate to close at 13 per cent by end of fiscal year. About 41 per cent of the participant expect it to above 13 per cent while 32 per cent anticipate it to be below 13 per cent.

In terms of currency outlook, 39 per cent of the participants expect PKR/USD to close above 205 by FY23 end. About 9 per cent believe it will remain in the range of 200-205 by FY23 end. About 23 per cent expect it to close in between 195 to 200 while the remaining project it to be below Rs195.

About 27 per cent of the participants are expecting inflation of 13-14 per cent in FY23, 16 per cent expect it to be between 14-15 per cent, 4 per cent anticipate it to be above 15 per cent. The remainder of them are eyeing an inflation of lower than 13 per cent in FY23.

READ MORE: State Bank enhances frequency of MP reviews to eight

In terms of GDP growth, 7 per cent of the participants thinks that GDP growth will be below 3 per cent, 32 per cent of them expects it to be between 3-3.5 per cent, 23 per cent of the participant project it to be 3.5 per cent-4.0 per cent. The remainder of them anticipate it to be above 4 per cent.

Participants remained divided on the expectations of current account deficit forecast for FY23 as 46 per cent participants expect current account deficit to be in the range of US$12-15bn while 18 per cent participants anticipate it to above US$15bn. The remainder of them expect it to be below US$12bn. 

Pakistan is currently facing tough economic times as depleting foreign exchange reserves, rising fiscal deficit amid huge petrol/diesel subsidy and indecisiveness by the new government on key economic measures is exacerbating economic issues.

READ MORE: Key policy rate goes up to 9.75%; SBP raises 250bps in less than month

It will key for government to take the required reform steps including removal of subsidy on petrol/diesel, measures to curb imports & improve tax collection. This will pave way for the resumption of IMF program which currently remain stalled and will result in dollar flows that could ease pressure on currency and foreign exchange reserves going forward.

Given concerns highlighted above along with rising inflation and weakening currency, we also anticipate SBP to raise the policy rate by 100bps.

KARACHI: The cut-off yield of treasury bills (T-Bills) increased sharply in an auction held on Wednesday indicating an expected rise in policy rate in upcoming monetary policy announcement scheduled for April 19, 2022.

“In today’s [April 06, 2022] treasury bills auction, cut-off yields increased by 60 – 80 basis points,” according to analysts at Topline Securities.

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The government raised Rs645 billion through auction of treasury bills against the target of Rs600 billion and maturity of Rs674 billion, according to results announced by the State Bank of Pakistan (SBP).

The key policy rate has been kept unchanged at 9.75 per cent in the last Monetary Policy Statement (MPS) on March 08, 2022. However, the cut-off yields of government securities have shown much higher rate against the policy rate.

READ MORE: State Bank enhances frequency of MP reviews to eight

The cut-off yields of 3-, 6- and 12-month papers increased by 80 basis points, 75 basis points and 60 basis points, respectively. The yields in three-month treasury bill increased to 12.80 per cent from 11.9999 per cent. Similarly, yields in six-month and 12-month papers have increased to 13.25 per cent from 12.50 per cent and 13.2999 per cent from 12.70 per cent, respectively.

READ MORE: Key policy rate goes up to 9.75%; SBP raises 250bps in less than month

The latest auction of treasury bills witnessed aggressive participation from the banks. The SBP received bids worth Rs911 billion against the target of Rs600 billion.

However, the central bank accepted bids worth Rs645 billion at maturity of Rs674 billion.

READ MORE: SBP decides to keep policy rate unchanged at 9.75%