Business

Returns on T-bills raised up to 39bps

Published

5 days ago

February 5, 2026

KARACHI: In the first auction after a surprise status quo in the monetary policy, the cut-off yields on the treasury bills were increased on Wednesday by up to 39 basis points, bringing the returns close to the State Bank’s policy rate of 10.50 per cent.

Before the monetary policy announced on Jan 26, returns on T-bills had mostly fallen to single digits, raising hopes of an interest rate cut of up to 100bps.

However, the interest rate remained unchanged, and some bankers cited that foreign investors were seeking high-yield bonds despite the higher risks.

The latest increase in yields could make T-bills attractive. Foreign investors have shown some interest in domestic bonds this fiscal year, but the uncertain geopolitical situation remains the biggest obstacle hampering inflows. The same was true of foreign direct investment, which fell sharply during the first half of this year.

The auction results show that the largest increase in T-bill rates was observed for the 12-month papers, with a 39bps increase to 10.39 per cent.

Similarly, the benchmark six-month papers offer 10.32pc, up from 9.94pc in the previous auction, increasing returns by 38bps. The government raised the highest amount of Rs315 billion for this tenor.

The cut-off yields on three-month and one-month were increased by 30bps each to 10.19pc.

The government received total bids of Rs2.354 trillion, while it picked Rs823bn, including Rs318bn from the non-bidding procedure. The target for the auction was Rs650bn while the maturity amount was Rs697bn.

Financial experts said higher T-bill rates would increase the government’s burden, as interest payments would rise further. The interest payment in FY26 would be around Rs8tr, the largest share of the budget for the current fiscal year.

Published in Dawn, February 5th, 2026

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Business

Stocks lose another 1,789 points amid volatility

Published

3 hours ago

February 10, 2026

hussainbinnoman3@gmail.com

KARACHI: As the Pakistan Stock Exchange (PSX) switched to a faster T+1 settlement cycle on Monday, market volatility persisted amid a dearth of positive triggers, as shaky investors continued taking profits amid broader economic concerns, pulling the benchmark index below the 181,000-point barrier intraday.

Topline Securities Ltd said the KSE-100 index closed lower at 182,340.38 points, shedding 1,789.20 points after a highly volatile session. The benchmark index moved within a wide range, touching an intraday high of 185,650.60 points before slipping to a low of 180,992.80 points.

The decline was led by heavyweight stocks, with Oil and Gas Development Company, Meezan Bank, Pakistan Petroleum Ltd, United Bank Ltd and Lucky Cement together dragging the index down by 932 points. These losses were partially offset by gains in select large-cap stocks, including Sazgar Engineering Works Ltd, MCB Bank and Nestle Pakistan, which collectively added around 220 points.

Market activity weakened, with total traded volume falling 26.8pc to about 931 million shares, while the value of shares traded declined 2.45pc to Rs58.8bn. K-Electric dominated volumes, with approximately 302 million shares traded.

PSX makes smooth transition to faster T+1 settlement system

Ali Najib, Deputy Head of Trading at Arif Habib Ltd (AHL), said the benchmark index opened on a positive note and climbed to an intraday high of 185,651 points. However, sentiment turned negative as the session progressed, with institutional selling triggering a sharp pullback.

He noted that the transition from T+2 to T+1 settlement was implemented smoothly and should be viewed as a structural change rather than a driver of prevailing market trends.

The T+1 replaces the previous T+2 system, meaning equities and deliverable futures trades will settle one business day after the trade date, accelerating the transfer of funds and securities, reducing risk, and improving market liquidity.

On the corporate side, Meezan Bank Ltd announced earnings per share of Rs11.88 for 4QCY25 along with a dividend of Rs7 per share, supported by improved spreads and deposit growth, although weaker non-funded income weighed on profitability. Allied Bank Ltd reported 4QCY25 earnings of Rs3.29 per share and declared a dividend of Rs1.75; quarterly earnings declined due to higher costs and subdued non-interest income, while full-year indicators showed improvement.

Analysts said the broader market trend remained one of consolidation, with the KSE-100 expected to trade in a volatile range between 180,000 and 190,000 points in the near term.

Published in Dawn, February 10th, 2026

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Business

SBP revises up GDP growth for FY26

Published

4 hours ago

February 10, 2026

hussainbinnoman3@gmail.com

KARACHI: The State Bank of Pakistan (SBP) has projected upward GDP growth in the wake of increased economic activity and continued momentum in high-frequency indicators.

The SBP released the data and analysis in the bi-annual Monetary Policy Report on Monday, noting that the growth outlook for FY26 has improved by 0.5 percentage points relative to the previous report, and real GDP growth is now projected at 3.75-4.75pc in FY26, with further improvement expected in FY27.

The economic growth has picked up noticeably, as reflected by higher year-on-year growth in Q1FY26 and improving trends in agricultural and industrial production, with positive spillovers expected for services sector activity, said the report.

Inflation is projected to remain within the 5-7pc target range for most of FY26 and FY27, despite near-term volatility, the report said.

The report noted that macroeconomic conditions and the outlook have improved, supported by a prudent monetary policy stance and continued fiscal consolidation.

The current account deficit is projected to remain contained at 0-1pc of GDP in FY26, with a higher trade deficit partly offset by robust workers’ remittances and planned official inflows.

As a result, SBP’s foreign exchange reserves are expected to rise to $18bn by June 2026.

The SBP recently reduced the CRR from 6pc to 5pc to increase banks’ liquidity and enhance the availability of funds to the private sector.

Published in Dawn, February 10th, 2026

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