Dhaka, Bangladesh (BBN) - Yields on treasury bills (T-bills) declined further on Sunday as banks channelled surplus liquidity into risk-free government securities amid subdued private sector credit demand ahead of the upcoming national polls.
The cut-off yield on the 91-day T-bills fell to 10.14 per cent from 10.42 per cent previously, while the yield on the 182-day bills eased to 10.25 per cent from 10.55 per cent.
The yield on the 364-day T-bills also dropped to 10.34 per cent from 10.66 per cent earlier, according to auction results.
The government raised BDT 80 billion on the day by issuing the three categories of T-bills to partially finance its budget deficit.
Yields on T-bills had also declined on similar grounds on January 4.
“Most banks are keen to invest their excess liquidity in government securities as private sector credit demand remains subdued ahead of the upcoming national election,” a senior Bangladesh Bank (BB) official said while explaining the latest market situation.
Private sector credit growth stood at 6.58 per cent year-on-year in November 2025, up slightly from 6.23 per cent in the previous month, according to the central bank’s latest data.
Higher inflows of remittances, coupled with the central bank’s purchases of US dollars, have further strengthened market liquidity, putting downward pressure on yields on government securities, the central banker noted.
Bangladesh Bank has so far purchased $3.75 billion from banks since July 13 under the prevailing free-floating exchange rate regime, BB data showed.
The central banker also said the current declining trend in government securities yields may continue in the coming weeks.
At present, four T-bills—14-day, 91-day, 182-day and 364-day—are auctioned to manage government borrowing from the banking system.
In addition, five government bonds with maturities of two, five, 10, 15 and 20 years are traded in the market.
BBN/SSR/AD