SBP raises PKR 1,226 billion through treasury bills, bonds

The State Bank of Pakistan (SBP) has raised a total of PKR 1,226 billion through the sale of Treasury Bills (T-Bills) and floating rate Pakistan Investment Bonds (PIBs), as the government continues to rely on domestic borrowing to manage the fiscal deficit.

In the latest T-Bill auction, market participation reached PKR 1,730 billion, with the government securing PKR 965 billion—exceeding its initial target of PKR 850 billion and surpassing the maturity of PKR 821 billion.

Yields declined by 1-7 basis points, bringing the current rates to 12.32% for the one-month T-Bill, 12.01% for the three-month T-Bill, 11.99% for the six-month T-Bill, and 12.01% for the 12-month T-Bill.

Meanwhile, in the floating rate PIB auction, the government raised PKR 261 billion against a participation of PKR 1,592 billion, falling short of its PKR 400 billion target.

The federal government’s total debt stock surged by over PKR 3,200 billion in the first seven months of fiscal year 2024-25, largely driven by domestic borrowing to bridge the fiscal deficit. According to SBP data, the central government’s total debt, which includes both domestic and external liabilities, increased by 4.65% during this period.

By the end of January 2025, Pakistan’s total debt stock stood at PKR 72,123 billion, up from PKR 68,914 billion in June 2024. Domestic borrowing played a significant role in this increase, rising by 6.5%, underscoring the financial challenges faced by the government.