Dhaka, Bangladesh (BBN) - The yields on 15-Year BGTBs and 20-Year BGTBs are likely to rise further today as banks may express unwillingness to invest their liquidity in the long-term securities.
The cut off yield, generally known as interest rate, on the 15-Year BGTBs rose to 12.28 per cent in the immediate past auction from 11.36 per cent earlier while the yield on the 20-Year BGTBs stood at 12.75 per cent from 12.o5 per cent, according to the auction results.
The government is set to borrow BDT 20 billion through issuing the BGTBs on Tuesday to partially meet its budget deficit.
Most of banks are maintaining a cautious approach in investing their excess funds in the long-term securities, considering the future liquidity situation in the market, according to market operators.
They also said the yield on 15-Year BGTBs may increase significantly today while the yield on 20-Year BGTBs is likely to go up slightly.
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