Islamabad August 10 2024: The rates for Short Term Savings Certificates (STSC) have been reduced by 134 basis points, dropping from 19.24% to 17.90%. Similarly, the return on the Savings Account (SA) has decreased by 150 basis points, now offering 19.00% compared to the previous 20.50%. The Serwa Islamic Saving Account (SISA) has also seen a reduction of 150 basis points, with the new rate set at 19.00%, down from 20.50%.
However, the rates for Defence Savings Certificates, Behbood Savings Certificates, Regular Income Certificates, Special Savings Certificates, Pensioners Benefits Account, Special Savings Account, Shuhada Family Welfare Account, and Serwa Islamic Term Account remain unchanged.
On August 8, 2024, in the primary market, cut-off yields for shorter tenors fell by 50-52 basis points compared to the previous auction. The 3-month and 6-month cut-off yields have dropped to an 18-month low, levels last seen in the February 8, 2023 auction. Meanwhile, the 12-month cut-off yield hit a 19-month low, with the previous low recorded on December 28, 2022, at 16.85 percent.
Investors submitted bids totaling Rs 1,778 billion, significantly exceeding the target of Rs 210 billion. Despite the lower rates compared to the previous auction, investors placed higher bids, anticipating monetary easing in the coming months and aiming to secure investments at the current higher rates.
In the secondary market, yields also declined, with the 3-month yield reaching its lowest level since February 19, 2023, when it was 18.70 percent. Similarly, the 6-month paper’s yield dropped to its lowest point since February 15, 2023, and the 12-month yield fell to its lowest level since January 18, 2023, when it was 17.19 percent.
