Yields on treasury bills (T-bills) edged down on Sunday as banks invested excess liquidity in risk-free government securities amid subdued private-sector credit demand amid ongoing geopolitical tensions.
Bankers said liquidity in the market improved following the disbursement of Tk 31 billion in cash incentives against exports, alongside the central bank's purchase of US dollars from commercial banks, putting downward pressure on yields.
According to auction results, the cut-off yield on 91-day T-bills-commonly referred to as the interest rate-fell to 10.17 per cent from 10.19 per cent previously. Also, the yield on 182-day T-bills declined to 10.47 per cent from 10.50 per cent, while the 364-day T-bill yield dropped to 10.65 per cent from 10.67 per cent.
The government raised Tk 90 billion on the day by issuing three types of T-bills to partially finance its budget deficit.
"Most banks are keen to invest their excess liquidity in government securities as private sector credit demand remains weak due to ongoing geopolitical tensions," a senior treasury official at a leading private commercial bank told The Financial Express, explaining the latest market trend.
Data from Bangladesh Bank showed that private sector credit growth stood at 6.03 per cent year-on-year in February 2026, unchanged from the previous month.
The official also noted that the central bank purchased $130 million from banks last week to help stabilise the US dollar-Bangladesh taka exchange rate, offsetting higher remittance inflows ahead of Eid-ul-Azha.
Since July 13 last year, the central bank has bought a total of $5.88 billion from banks directly under the prevailing free-floating exchange rate regime, according to Bangladesh Bank data.
The private banker also expects that the existing trend of yields on the government securities may continue in the coming weeks.
Currently, four T-bills are transacted through auctions to adjust government borrowings from the banking system. The T-bills have 14-day, 91-day, 182-day and 364-day maturity periods.
In addition, five government bonds, with tenures of two, five, 10, 15 and 20 years respectively, are traded in the market.
siddique.islam@gmail.com
