Morning News: Govt raises Rs1.62 trillion via T-bill, bond auctions - By WE Research
Jul 10 2025
- The State Bank of Pakistan (SBP) raised approximately Rs1.62 trillion through recent government securities auctions, primarily from Market Treasury Bills (MTBs), which accounted for Rs1.413 trillion, and Rs208.42 billion from 10-year Pakistan Investment Bonds Floating Rate (PFL). The MTB auction showed strong investor demand across all tenors, particularly the 12-month bills, signaling a shift toward longer durations amid falling yields. Non-competitive bids totaled Rs379.78 billion, mostly concentrated in the three-month tenor. While the total fell slightly short of the Rs1.7 trillion target, analysts noted increased interest in longer-term securities and a flattening yield curve. Meanwhile, the Pakistani rupee slightly weakened to Rs284.47 against the dollar, and local gold prices dropped Rs3,000 per tola to Rs351,500 due to a stronger US dollar and lower international gold rates.
- From July 7 to 11, 2025, Pakistan’s Ministry of Finance conducted a non-deal investor roadshow (NDR) in Beijing to prepare for its first-ever Panda Bond issuance. Shared by Advisor to the Finance Minister Khurram Shehzad, the meetings involved technical discussions with Chinese investors, underwriters, legal advisors, and rating agencies, focusing on Pakistan’s economic outlook, debt management reforms, and the structure of the upcoming bond. The NDR garnered strong initial interest, reflecting investor confidence in Pakistan’s reform path and signaling its readiness to access China’s onshore capital market. The government aims to finalize the bond launch later this year, backed by credit guarantees from multilateral partners—marking a strategic step toward diversifying funding sources and expanding Pakistan’s presence in international capital markets.
- The National Electric Power Regulatory Authority (Nepra) has approved provisional negative fuel cost adjustments (FCA) for April and May 2025: Rs4.043/kWh for K-Electric (KE) consumers and Rs0.50 per unit for Discos. These adjustments will reflect in July 2025 bills and exclude lifeline, protected, EV charging stations, and pre-paid consumers. Although the Ministry of Energy (MoE) requested to delay the KE FCA decision, citing workload and ongoing efforts to implement uniform FCAs nationwide, Nepra rejected the request due to lack of formal Cabinet approval or policy guidelines. Nepra emphasized that FCA proceedings cannot be indefinitely deferred without legal grounds and noted that the current framework permits monthly fuel cost adjustments. The Authority also reaffirmed its commitment to calculating individual Disco FCAs while moving toward a uniform national FCA regime as mandated by law. Concerns were raised during hearings about the high cost of furnace oil-based generation, and CPPA-G was instructed to manage inter-Disco settlements to reflect actual energy costs.