The government of Pakistan, through the State Bank of Pakistan (SBP), is targeting to raise a total of Rs5.25 trillion over the three months from January to March 2025. This ambitious goal will be achieved through the auction of Market Treasury Bills (MTBs) and Pakistan Investment Bonds (PIBs), both fixed-rate and floating-rate. Of the total target, Rs2.2 trillion will be raised via Market Treasury Bills, while the remaining Rs3.05 trillion will be sourced through the sale of Pakistan Investment Bonds. The breakup of the target reveals that Rs2,200 billion is expected to be raised through MTBs, with Rs1,050 billion coming from PIBs fixed rate, and Rs2,000 billion from PIBs floating rate.
To meet this target, the SBP has scheduled a series of six auctions for Market Treasury Bills throughout the first quarter of 2025. The first two auctions in January will occur on the 8th and 22nd, with targets set at Rs250 billion and Rs350 billion, respectively. February will see two more auctions on the 4th and 19th, with a target of Rs350 billion and Rs250 billion. The final two auctions for the review quarter will be held in March, on the 5th and 19th, with targets of Rs500 billion each.
In addition to the MTBs, the SBP aims to raise Rs3.05 trillion through the sale of PIBs, which includes Rs1,050 billion through Fixed Rate PIBs and Rs2,000 billion through semiannual Floating Rate PIBs. The SBP plans to conduct three auctions for fixed-rate PIBs, each with a target of Rs350 billion. These measures are part of the government’s strategy to manage its debt obligations and stabilize the fiscal situation.
The SBP has also revised the coupon rates for Fixed-Rate Pakistan Investment Bonds (PIBs), which will come into effect on January 16, 2025. The updated coupon rates for the 02-Year, 03-Year, 05-Year, 10-Year, and 15-Year PIBs are now set at zero percent for the 02-Year bond and 12.00% for the 03-Year, 05-Year, 10-Year, and 15-Year PIBs. This marks a significant reduction from the previous coupon rates issued on September 20, 2024, which were higher—14.00% for the 03-Year and 05-Year bonds, and 13.00% for the 10-Year bond.
The SBP’s comprehensive auction schedule aims to meet the government’s financing needs while managing Pakistan’s debt obligations. This strategic approach to raising funds through both MTBs and PIBs demonstrates the government’s effort to stabilize the economy, manage inflation, and address the fiscal challenges posed by Pakistan’s growing public debt. The revised coupon rates further highlight the SBP’s response to current market conditions, signaling the central bank’s continuous efforts to balance the budgetary goals with market demands.