Pakistan national savings rates slashed across all savings plans

The Pakistan National Savings Directorate has reduced profit rates on all savings plans by up to 360 basis points, effective from November 4.

The profit rate on Special Savings Certificates dropped by 360 bps to 11.60%, while the Sarwa Islamic Savings Account and Term Account saw a decrease of 309 bps to 11.16%.

According to National Savings, the profit rate on the Special Savings Account fell by 220 bps to 13%, and the regular income certificate by 60 bps to 12.12%. The rates for behbood, pensioners, and shuaddas dropped by 24 bps to 13.92%.

These rate adjustments align with trends in Pakistan Investments. Following a continuous rate cut in the benchmark interest rate by 450 bps, the yields of Pakistan Investment Bonds (PIBs) also declined.

On October 17, the State Bank conducted an auction where the two-year tenor cut-off yield fell by 74 bps to 13.24%. The three-year tenor cut-off yield dropped by 40 bps to 12.5%, the five-year tenor by 61 bps to 12.8%, and the ten-year tenor by 22 bps to 12.98%.

A dealer indicated that further rate cuts might be forthcoming, potentially reducing the profit rates on National Savings even more.