---

Yields on treasury bills declined again on Sunday after the Bangladesh Bank purchased $123 million from eight banks, injecting liquidity into the market while seeking to stabilise the exchange rate.

The cut-off yield on 91-day T-bills fell to 10.02 per cent from 10.11 per cent. The 182-day yield dropped to 10.11 per cent from 10.22 per cent, while the 364-day papers declined to 10.07 per cent from 10.23 per cent, according to auction results.

The government raised Tk 75 billion through the issuance to partially finance its budget deficit.

Liquidity boost

Market participants said the central bank’s dollar purchase released Bangladesh Taka into the banking system, increasing liquidity and putting downward pressure on yields.

As part of its open market operations, the central bank bought the $123 million through an interbank spot auction under the Multiple Price Auction method at a cut-off rate of Tk 122.30 per dollar.

Since July 13 last year, the central bank has purchased a total of $5.38 billion from banks under the prevailing free-floating exchange rate regime.

Officials said the move is aimed at maintaining exchange rate stability, preserving export competitiveness and supporting remittance inflows, while gradually rebuilding foreign exchange reserves.

Weak private credit

A senior central bank official said banks are increasingly investing surplus funds in government securities as private sector credit demand remains subdued following the recent national election.

Private sector credit growth slowed to 6.10 per cent year-on-year in December 2025, down from 6.58 per cent a month earlier, according to central bank data.

With limited appetite for private lending, excess liquidity has flowed into government instruments — reinforcing the recent easing trend in short-term yields.