Written by The Banking Post
Treasury bill yields rose on Sunday following the rollout of new primary dealer (PD) guidelines aimed at boosting activity in both the primary and secondary government securities markets.
Auction results showed the cut-off yield on 91-day T-bills climbed to 10.40 percent from 10.05 percent, while the 182-day bills rose to 10.34 percent from 10.23 percent. The yield on 364-day T-bills also inched up, reaching 10.49 percent from the previous 10.34 percent.
On the day, the government raised Tk 75 billion through the issuance of three types of T-bills to partially finance its budget deficit.
A senior central bank official said the increase in yields reflects the impact of the new PD guidelines, under which only designated primary dealer banks are allowed to submit bids at auctions. The change has tightened participation and pushed rates higher, he explained.
Earlier, the central bank appointed 24 banks as primary dealers to strengthen trading of government securities, particularly in the secondary market.
Currently, the government issues four types of treasury bills—14-day, 91-day, 182-day and 364-day—through regular auctions to manage short-term borrowing from the banking system. Alongside these, five government bonds with maturities ranging from two to 20 years are actively traded to meet longer-term financing needs.
