The 6-month Karachi Inter-Bank Offered Rate (KIBOR) has fallen to 12.88 percent as of November 28, 2024, according to Bloomberg data. This marks a significant decrease, positioning the KIBOR 212 basis points below the central bank’s key lending rate, which currently stands at 15 percent.
Topline Securities reports that the 6-month KIBOR has decreased by 49 basis points, reaching its lowest level in 31 months. This decline follows a mid-week secondary market auction where the government successfully raised Rs. 616 billion in debt at rates below the central bank’s policy rate.
In the bond auction held on Wednesday, cut-off yields for 3-month, 6-month, and 12-month Treasury bills decreased by 70 basis points, 61 basis points, and 85 basis points, respectively, settling at 12.9974 percent, 12.8948 percent, and 12.3500 percent. The 3-month yield has reached its lowest level since April 2022, while the 6-month and 12-month yields have dropped to levels last seen in March 2022.
The auction attracted bids totaling Rs. 2,494 billion against a target of Rs. 800 billion, resulting in a bid-to-cover ratio of 3.1x. Despite the high demand, the State Bank of Pakistan accepted Rs. 616 billion, falling short of the target.
