With a fresh gain of Rs0.55 on Monday, rupee has recovered 8.54% or Rs14.39 during the past seven months to date. PHOTO: FILEThe cost of commercial bank financing has hit a record high at 16% on fresh lending to the government at a time when the country is facing high inflation and busy fighting the widespread flood devastation. The high cost of borrowing forced the government to raise Rs817 billion through the sale of its debt securities – three to 12-month treasury bills – to commercial banks, which was lower than the pre-auction target of Rs1 trillion. The T-bills’ auction came as the government was to repay the maturing papers worth Rs1.028 trillion to the commercial banks. The cut-off yield (cost of government borrowing) could have gone further high had the government decided to raise a higher amount.

Source: The Express Tribune September 08, 2022 15:38 UTC