Dhaka, Bangladesh (BBN) - The yields on treasury bills (T-bills) increased on Sunday as banks expressed unwillingness to invest their excess liquidity in the securities ahead of the Eid-ul-Azha.
The cut-off yield, generally known as interest rate, on the 91-day T-bills rose to 11.69 per cent on the day from 11.65 per cent of the previous level while the yield on 182-day T-bills reached 11.85 per cent from the earlier level of 11.51 per cent.
However, the yield on 364-day T-bills rose to 11.75 per cent from 11.62 per cent earlier, according to the auction results.
Most banks are reluctant to invest their excess funds in the government-approved securities ahead of the Eid, according to market insiders.
They also said the banks want to manage their funds efficiently ahead of the Eid.
However, the government borrowed BDT 75 billion on the day through issuing three types of T-bills to help meet the budget deficit.
Currently, four T-bills are offered 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.
Furthermore, five government bonds, with tenures of two, five, 10, 15 and 20 years respectively, are traded on the market.
BBN/SSR/AD