Pakistan government executes first-ever T-bills buyback program

Pakistan government has successfully repurchased PKR 351 billion worth of treasury bills, falling short of its initial target of PKR 500bn. This marks the country's first-ever T-Bills Buyback Program.

The government acquired PKR 200bn worth of bills maturing on December 12, with a cut-off yield of 16.01%, and an additional PKR 150bn worth of bills maturing on December 24, at a cut-off yield of 16%. The State Bank of Pakistan (SBP) also participated, purchasing PKR 1.0bn worth of bills through a non-competitive bidding process.

This buyback initiative is expected to save the government approximately PKR 23bn in interest payments, as it will now pay lower interest rates on these bonds. Analysts suggest that this move reflects confidence in the country's fiscal position and is likely to benefit both short-term money market operations and long-term fiscal sustainability.

Moreover, the lower yields observed in this buyback could signal increased investor confidence, potentially encouraging more private-sector investment and stimulating broader economic growth.