Dhaka, Bangladesh (BBN) - The yields on Treasury Bills (T-bills) are likely to fall further today as banks may express willingness to invest their excess liquidity in the short-term securities.
The cut off yield, generally known as interest rate, on the 91-Day T-bills came down to 11.48 per cent in the immediate past auction from 11.51 per cent of the previous level while the yield on 182-Day T-bills fell to 11.72 per cent from 11.75 per cent.
However, the yield on 364-Day T-bills also came down to 11.89 per cent on the day from 11.92 per cent of the previous level, according to the auction results.
“Lower credit requirement of the interim government is pushing down the yields on both treasury bills (T-bills) and BGTBs,” a market insider said while explaining the downward trend of yields on the government securities (G-Sec).
He also said the existing falling trend of yields on the G-Sec may continue in the coming months if the government revises downward its bank borrowing target for the current fiscal year (FY), 2024-25.
On Monday last, Bangladesh Bank Governor Ahsan H Mansur told reporters that the government's bank borrowing target would be reduced to BDT 800-850 billion from the previous estimation of Tk 1375 billion in order to reduce the government's loans from the banking sector.
The government net bank borrowing is set to be BDT 1375.00 billion for the FY’25 from BDT 1323.95 billion in the previous year, according to the budget documents.
The government is set to borrow BDT 75 billion on Sunday through issuing three-type of the T-bills to partially meet its budget deficit.
Currently, 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.
The bills are short-term investment tools issued through auction, conducted by the central bank on behalf of the government.
Furthermore, five government bonds, with tenures of two, five, 10, 15 and 20 years respectively, are traded on the market.
BBN/SSR/AD