Dhaka, Bangladesh (BBN) - The yields on 15-Year BGTBs and 20-Year BGTBs are likely to fall today as banks may express willingness to invest their liquidity in the long-term securities.
“The yields on the BGTBs may fall slightly today despite announcement of policy rate hike twice within October to curb inflationary pressure on the economy,” a market insider explained.
He also said the yields on government securities may fall significantly if the government downward revise of its bank borrowing target for the current fiscal year (FY), 2024-25.
On Monday, Bangladesh Bank Governor Ahsan H Mansur said the government's bank borrowing target would be reduced to BDT 80,000-85,000 crore from the previous estimation of BDT137,500 crore in order to reduce the government's loans from the banking sector.
The cut off yield, generally known as interest rate, on the 15-Year BGTBs remained unchanged at12.65 per cent in the immediate past auction from the previous level while the yield on the 20-Year BGTBs stayed at 12.75 per cent unchanged from the previous level.
The government is set to borrow BDT 20 billion through issuing the two-type of long-term treasury bonds on Tuesday to partly meet its budget deficit.
The cut off yield, generally known as interest rate, on the 15-Year BGTBs came down to 12.65 per cent in the immediate past auction from 12.70 per cent earlier while the yield on the 20-Year BGTBs reached at 12.75 per cent from 12.80 per cent.
Currently, five government bonds, with tenures of two, five, 10, 15 and 20 years respectively, are traded on the market.
On the other hand, four T-bills are transacted through auction to adjust government borrowings from the banking system. The T-bills have 14-day, 91-day, 182-day and 364-day maturity periods.
BBN/SSR/AD