TREASURY bills auctioned last week attracted bids worth 402.47bn/-, giving signal of continued investors rush for risk free debt instrument.
But investors move to go for risk free
investments has denied credit extension to other economic sectors that
could contribute immensely to the country’s development. The treasury
bills auctioned last week attracted bids worth 402.47bn/-, which is over
two times the amount sought to be raised, a sign of high market
liquidity among investors.
Investors in the government securities
particularly commercial banks dominated the show of the treasury bills
auction, the situation that may have impacted on the credit extended to
the private sector. Other investors in the treasury bills auction are
pension funds and some microfinance institutions.
However, apart from oversubscriptions,
the government retained 165bn/- as successful amount slightly below
169bn/-, the amount offered to the market for bidding.
Central Bank uses the shortterm
government note to mop excess liquidity in the circulation. Interest
rates on the 364 tenure declined to 9.29 per cent from 9.65 per cent and
10.24 per cent and 10.76 per cent of the two previous sessions.
Yield rate on 182 days tenure declined
to 6.88 per cent from 7.27 per cent, 7.35 per cent and 7.68 per cent of
the preceding sessions. Weighted average yield declined to 6.88 per cent
on the session held on Wednesday compared to 7.27 per cent held two
weeks ago.
Weighted average price for successful
bid increased to 91.52 from 96.68 per cent the last sessions. The 364
days tenure attracted bids worth 215.99bn/- compared to 100bn/- offered
to the market and at the end 100bn/- was retained as successful amount.
The 182 days offer attracted bids worth
186.15bn/- compared to 65bn/- offered to the market for bidding and
65bn/- was kept as successful amount.
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