T-bill auction raises four times more than target

The cash-starved government raised almost 300 per cent more than the target through the auction of treasury bills on Wednesday, reflecting a widening gap between revenue collection and its ever-rising expenditures. The caretaker government has been borrowing heavily to meet the rising spending while the banks are equally eager to invest in the risk-free high-yielding government papers. In the last auction held on Dec 13, the government raised Rs2.15 trillion. The State Bank of Pakistan (SBP) reported the government raised Rs1.9tr mostly for 12-month tenor on Wednesday. Investors are cautious about the interest rate which may see a change in coming months. Most of the bids were offered for 12-month T-bills, unlike the previous trend of investing in three-month papers.