Economy: 3 Months Cut-off Yield dropped by 26 bps to 15.73%, Market anticipating drop in Policy Rate despite risks on external accounts! – By TSBL Research

<p></p><ul><li><span style="font-family:Arial, Helvetica, sans-serif;font-size:medium;">In the T bill auction yesterday, massive participation of over Rs1.2 trillion or around 60% of total participation witnessed in 3 months paper in anticipation of a drop in the upcoming Policy rate by the central bank which is scheduled on 10th Oct, coupled with further downward adjustment in CPI Inflation going forward. This led to a drop of 3 months cut-off yield by 26 bps from 15.99% to 15.73%. Whereas, the 6-month &amp; 1-year cut-off yield also dropped by 25 bps &amp; 24 bps respectively. It is expected that ongoing &ldquo;optimism&rdquo; in the markets to continue, reflected in the rupee recovery despite risks to the stagnant exports, and drying inflows. However, post-flood shocks and ongoing economic slowdown, stagnant exports, dried inf...