An employee counts Pakistani rupee notes at a bank in Peshawar, Pakistan August 22, 2023. REUTERS/Fayaz Aziz
Cut-off yields on 1-year Sukuk have dropped by nearly half in the space of just six months to below 11 percent.
In around 6 months time, cut-off yield on 1 year Sukuk has come down from over 20 percent to 10.99 percent. According to Toploiine Securities, this is due to falling interest rates on the back of receding inflation.
The State Bank of Pakistan on Monday decreased the interest rate by 250 basis points to 15 percent, effective November 4, 2024.
In total, the central bank has cut the policy rate by 700 bps in the last four monetary policy meetings.
SBP has been of the view that inflation has declined faster than expected and has reached close to its medium-term target range in October.
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