Due to the effective efforts of the Government of Pakistan and the comprehensive policies of the Special Investment Facilitation Council (SIFC), key economic indicators are showing positive momentum, reflecting growing economic stability in the country.
For the first time in nearly five years, market yields have fallen into single digits and trading has begun below the policy rate. As a result of the government’s cautious and well-organized debt management strategy, a significant reduction in the cost of public borrowing has been recorded.
According to the Ministry of Finance, the continued decline in market yields has created greater room for private sector credit while easing overall financial pressure. The ministry said that by securing strong borrowing on favorable terms, funding costs have been reduced, further strengthening market stability.
Market yields have dropped below the policy rate for the first time since 2021, signaling a notable improvement in investor confidence. Declines were recorded across the entire yield curve, with treasury bill cut-off rates falling by 29 to 34 basis points, while cut-off rates on Pakistan Investment Bonds of various tenors declined by 59 to 70 basis points.
In the latest auction of Pakistan Investment Bonds, the government raised Rs488 billion against a target of Rs450 billion, while bids worth Rs1.458 trillion were received, reflecting strong market participation and growing confidence.
Finance Minister Muhammad Aurangzeb said that under an active debt management strategy, Pakistan remains in a savings position on debt servicing during the current year. He noted that easing yields would further streamline and improve the efficiency of public debt servicing.
The finance minister added that the strategy is helping preserve liquidity while supporting small and medium enterprises (SMEs), agriculture, housing and employment-generating sectors. He said the improving economic outlook reinforces prospects for sustainable, private sector-led growth.
