T-bills see net $167.3m foreign outflows on lower rates, global uncertainty amid tariff war

#Tbills #net #167.3m #foreign #outflows #rates #global #uncertainty #tariff #war

KARACHI: Pakistan’s short -term local government bonds suffered from the cost of the second consecutive month in April, as foreign investors became cautious during the sharp decline in interest rates, as well as trade tensions and geographical political risks.

State Bank of Pakistan (SBP) data reported on Wednesday that foreigners invested $ 5.023 million in Treasury Bills until April 18, but withdrew $ 172.3 million, resulting in a net emission of $ 7 167.3 million, which said on Wednesday.

Between July 1, 2024 and April 18, 2025, investors bought $ 1.168 billion in T -bills and distributed $ 1.355 billion, resulting in a net emitting net worth $ 187 million.

Saad Haneef, the head of research in Ismail Iqbal Securities, said that the confidence of foreign investors has been permanently damaged, with T -bills $ 197.4 million in March 2025 and in April (11), with 4 164.9 million (up to 11), it has reached $ 164.9 million, which is permanent. “This sharp reversal follows the severe arrival found during the mid -2024, especially in May, the top of $ 229.6 million,” Hanif said.

“Expenses appear to be driven by taking profit, a 10 pp [percentage points] The reduction in interest rates, which increases the geographical political uncertainty, including the appeal of the T -bill, the reduction of rupee, and the threats of trade war.

“When February saw a short .9 million $ 46.9 million, heavy sales return shows that investors have caution,” he said.

Analysts warned that concerns over the potential increase between India and Pakistan are a source of uncertainty and that foreign investors have a negative impact on Pakistan’s economy. According to the Pakistani Minister of Information, India will take military action within the next 24 to 36 hours, who also said that Pakistan would react “assured and decisively”.

US President Donald Trump ordered a slate of import tariffs in early April, which put the global economy in uncertainty. Although it has temporarily halted the heavy rates on almost all commercial partners, 10 % blanket duty is intact, which is 145 % tariff on China, the largest trade partner in the United States.

Pakistan’s central bank did not change its benchmark interest rate by 12 %, citing unstable food and energy prices and external account pressure risks. However, it also acknowledged the steady decline in inflation and a lot of positive interest rates in the front.

Analysts believe that due to the permanent disorder trend and appropriate interest rate cushion, there is a possibility of a reduction in the measuring rate to strengthen economic recovery without risking economic stability. According to analysts and markets, SBP is expected to reduce the policy rate of SBP by 50 points at its next policy meeting on Monday.

T -Bill receives flat before the monetary policy next week

On Wednesday, the government collected Rs 562 billion from the auction of market treasury bills, while next week the Central Bank’s interest decision remained flat. The amount deposited in it was less than the maturity amount of Rs 6698 billion, but it was higher than the target of $ 400 billion. A total of Rs 1.505 trillion was seen in the auction.

The cut -off production on one month’s T -Bills fell from 17 to 12.1492 percent. Production on three -month paper has not changed at 12.0098 %. However, the production of six months tanler was reduced by 1 bpS to 11.9998 %. Production on a 12 -month T -Bill was flat at 12.01 %.

In the auction of Pakistan’s Investment Bonds (Flooter), the government collected Rs 321 billion (competitive and non -competitive) against a target of Rs 1.537 trillion and a target of Rs 1550 billion.

In addition, the government deposited Rs 105.23 billion from the sale of lease Sukk in the Pakistan Stock Exchange (PSX).

Analysts expect the State Bank of Pakistan (SBP) to reduce interest rates on a policy meeting on Monday on a 50-100 basis.

It added, “Inflation is estimated at 0.6 percent of the year in April, the lowest level in the six decades, which is from 0.7 percent of YOY on the back of food, transportation and housing indicators in the past month.”

“We expect MPC [Monetary Policy Committee] In order to reduce interest rates to 100 bps by 11 %, the rest of the science is ease with an additional 150 twenty points.