SBP Overnight Reverse Repo (Ceiling) Rate Now At 22%

The State Bank of Pakistan (SBP) has fixed its Overnight Reverse Repo (Ceiling) rate at 22 percent, 100 basis points above the policy (target) rate of 21 percent. Meanwhile, the SBP Overnight Repo (Floor) rate has been set at 20 percent or 100 bps below the policy rate. As a result, the Floor and Ceiling levels for the Interest Rate Corridor are 20% and 22% p.a., respectively, with a width of 200 bps between them. The SBP aims to ensure that the overnight rate in the domestic money market stays close to the SBP Policy Rate. The new rates went into effect on April 5, 2023. It’s worth mentioning that this week’s Treasury Bills auction saw yields rise by 40 basis points, with the government raising Rs. 2,248 billion against a target of Rs. 900 billion. The cut-off yield for the 6-month T-Bills went down by 1 bps to 21.9789 percent while the cut-off yield for the 12-month T-Bills went up by 40 bps to 21.8898 percent from 21.4899 percent.