Dhaka, Bangladesh (BBN) - The auction of 90-Day Bangladesh Bank (BB) bills is scheduled to be started from today aiming to manage liquidity efficiently, officials said.
The cut off yield, generally known as interest rate, on the 90-Day BB Bills is expected to fix below the yield on 91-Day Treasury Bills (T-bills) at the first auction of the monetary instrument.
Earlier on November 27, the central bank of Bangladesh decided to introduce two more Bangladesh Bank (BB) bills shortly aiming to transmit monetary policy through managing liquidity more effectively.
The twin BB bills will be 90-Day and 180-Day tenures.
Currently, three BB bills are being used through auctions to adjust the monetary programmes of the central bank. The BB bills have 07-day, 14-day and 30-day maturity periods.
After a pause of three years, the banking regulator resumed operations of 30-day BB bills from November 20 last in a bid to offset liquidity, high-powered money in particular, from the market.
Since resumption of the 30-day BB bills, the central bank mopped up BDT 9.61 billion from the market in two auctions held on November 20 and November 27 this year through competitive bidding where the cut-off yield was 11.10 per cent.
The money-sterilising move of the central bank comes following injections of high-powered money also known as print money through various instruments to bring stability in the money market amid prevailing contractionary monetary regime.
BBN/SSR/AD