Pakistan to raise PKR 5.254 trillion through treasury bills and bonds in the quarter

Pakistan plans to raise PKR 5.254 trillion through the sale of treasury bills and investment bonds in the first quarter of 2025, according to the State Bank of Pakistan (SBP).

The SBP's schedule indicates that six T-Bill auctions will be conducted during the quarter, targeting PKR 2.2 trillion. It may be mentioned here that maturing T-Bills during the period amount to PKR 3.45 trillion.

Additionally, three auctions of fixed rate Pakistan Investment Bonds (PIBs) aim to raise PKR 1.05 trillion. Maturing PIBs in current quarter amount to PKR 70 billion.

Moreover, government will also raise PKR 2.0 trillion through six auctions of floating rate PIBs during the period.

Foreign investors have withdrawn 64% of their investments from Pakistan's T-Bills, with outflows reaching $550.6 million in the first five months of FY25. Experts attribute this trend to falling interest rates, with T-Bill yields dropping sharply due to a 900 basis points cut in the policy rate since June.

Political uncertainty and better investment options abroad have further deterred foreign inflows, which were net zero in early December. The highest inflows came from the UK ($596.6 million), UAE ($85 million), Australia ($52 million), and Bahrain ($50 million), but these were accompanied by significant outflows.

Experts warn that foreign investments in T-Bills could continue to dry up in the coming months.