Karachi December 24 2021: State Bank of Pakistan is conducting another OMO of 63 days in an effort for providing stability and lowering the debt servicing cost of the government.
“We are going to take a pause to first look at the effects of the tightening we have already done,” Baqir told Bloomberg Television’s Rishaad Salamat and Yvonne Man.
He added “Fiscal policy has been very complementary and is also withdrawing stimulus so a coordinated macroeconomic response, we think, will be number one to sustain recovery and keep inflation broadly in check.”
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Earlier, In first of its kind, Pakistan’s Central Bank conducted a 7 and 63-days OMO (injection) today on December 17 2021, as per data released by State Bank of Pakistan.
Yields in money markets are down by 15-55 bps since OMO injection for 63 days to 10.21 percent, 10.9 percent and 11.32 percent, for 3M, 6M and 12M papers, respectively as per data published by MUFAP.
On December 17 2021, SBP offered amount of Rs1,086bn in 7-days and Rs753bn in 63-days. SBP picked Rs1,086bn at 9.82% in 7-days and Rs689bn at 9.90% in 63-days.
That was the first time 63-days OMO conducted by SBP.
To recall SBP in its recent Monetary Policy Statement (MPS) said that across all tenors, secondary market yields, benchmark rates and cut-off rates in the government’s auctions have risen significantly. The MPC noted that this increase appeared unwarranted. In spite of that, yields in last T-Bill auction remained the same while in secondary markets it went up by 20-30bps after the auction.
