Latest news with #UnitedKingdomDebtManagementOffice
Yahoo
13-05-2025
- Business
- Yahoo
Issue of Debt
LONDON, May 13, 2025--(BUSINESS WIRE)-- DMO-TAS031/3475/002 The Minster Building21 Mincing LaneLondonEC3R 7AG T 020 7862 6500F 020 7862 13 May 2025 A078\25 PRESS NOTICE RESULT OF THE SALE BY AUCTION OF £1,000 MILLION OF 0 5/8% INDEX-LINKED TREASURY GILT 2045The United Kingdom Debt Management Office ("DMO") announces that the auction of £1,000 million of 0 5/8% Index-linked Treasury Gilt 2045 (ISIN code: GB00BMF9LH90) has been allocated as follows:(Note: all prices in this notice are quoted in pounds and pence) 1. All bids which have been accepted at the striking price have been allotted 64.0000% of the amount bid bids made at prices above the striking price have been allotted in full. Competitive bids made at prices below the striking price have been rejected. Real Clean Price Inflation-adjusted Clean Price* Real Yield 2. Striking Price £74.300 £80.547887 2.235% 3. The total amounts allotted and bids received were as follows: Amount allotted to bids £850.000 million Amount allotted to non-competitive bids Gilt-edged Market Makers £150.000 million Others £0.000 million £1,000.000 million Total bids received £3,189.000 million Times covered** 3.19 x 4. An additional amount of the Stock totalling up to £250.000 million will be made available to successful bidders for purchase at the non-competitive allotment price, in accordance with the terms of the Information Memorandum. 5. Stock allotted to members of CREST will be credited to their accounts by member-to-member deliveries on the relevant settlement date. *The Inflation-adjusted clean price has been calculated using an index ratio of 1.08409 and should not be rounded. It is displayed to 6dp for illustrative purposes only.**Times covered is rounded to the nearest 2dp. View source version on Contacts UK Debt Management Office Error in retrieving data Sign in to access your portfolio Error in retrieving data Error in retrieving data Error in retrieving data Error in retrieving data
Zawya
27-03-2025
- Business
- Zawya
UK bond chief hails 'important shift' away from long-dated issuance
LONDON - The head of the agency that issues British government bonds said there would be an "important shift" away from long-dated debt in the coming financial year in response to rising borrowing costs and reduced investor demand. The United Kingdom Debt Management Office announced on Wednesday that it would issue 299 billion pounds ($385 billion) of government bonds this year - the second highest amount on record. But the share accounted for by long-dated conventional gilts with a maturity of more than 15 years will drop to 13%, the lowest since 1990 and down from nearly 20% this financial year. "The DMO is going to continue ... a well-diversified programme of issuance across all maturity sectors. But there is an important shift in the proportions this year," DMO Chief Executive Jessica Pulay said. "This reflects our analysis of cost and risk for the exchequer, and this also takes into account market feedback on declining structural demand for long-dated gilts," she added. Britain has the longest average maturity debt stock of any Group of Seven economy, at 14.4 years at the end of 2024. This reflects historic demand from British pension funds and life insurers which has faded significantly in recent years, prompting bond investors and dealers to recommend the DMO scale back long-dated issuance at a faster pace this year. Gilt prices rose sharply after the DMO announcement which showed slightly lower-than-expected planned overall gilt sales for 2025/26 - with 30-year gilts gaining the most. "I like it. There was no need for the DMO to issue so many longer-dated gilts," said James Athey, a fixed income manager at UK-based fund manager Marlborough. Thirty-year gilt yields hit their highest level since 1998 in January at 5.47% and at 5.30% still command a greater premium over short-dated gilts than is the case with U.S. bonds. "In a period of heightened uncertainty investors are increasingly looking to the short end of the curve as a safer play," Athey said. SHIFTING SHORTER Tilting issuance towards short-dated conventional gilts with a maturity of up to seven years - which will account for at least 37% of issuance in the coming year, up from 35% before - would also make it easier to hold larger auctions, Pulay said. Long-dated gilts are riskier for most investors than shorter maturities, so auctions for the former must generally be smaller. Pulay also highlighted an increase in the "unallocated" portion of gilt issuance which stands at 9% at the start of the 2025/26 financial year compared with 4% at the start of 2024/25. This would allow the DMO to respond to in-year changes in market demand for gilt "on a more regular and active basis", she said. Britain has generally attracted high demand for gilts at auctions and at bond syndications - several of which have attracted record volumes of orders this year, including for long-dated conventional and index-linked gilts. "High-quality institutional demand for long maturity gilts continues to be present," Pulay said. She also played down the risk that Britain would find it harder to sell debt as historically low issuers such as Germany ramp up borrowing to fund greater defence and infrastructure investment. "Sterling remains one of the leading global reserve currencies, and ... the results of our operations over the course of 2024-25 demonstrate very visibly the continued demand for sterling in general and for the gilt product in particular," she said. ($1 = 0.7764 pounds)
Reuters
26-03-2025
- Business
- Reuters
UK bond chief hails 'important shift' away from long-dated issuance
LONDON, March 26 (Reuters) - The head of the agency that issues British government bonds said the agency would make an "important shift" away from long-dated debt in the coming financial year in response to rising borrowing costs and reduced investor demand. The United Kingdom Debt Management Office announced on Wednesday that it would issue 299 billion pounds ($385 billion) of government bonds this year - the second highest amount on record. But the share accounted for by long-dated conventional gilts with a maturity of more than 15 years will drop to 13%, the lowest since 1990 and down from nearly 20% this financial year. "The DMO is going to continue ... a well-diversified programme of issuance across all maturity sectors. But there is an important shift in the proportions this year," DMO Chief Executive Jessica Pulay said. "This reflects our analysis of cost and risk for the exchequer, and this also takes into account market feedback on declining structural demand for long-dated gilts," she added. Britain has the longest average maturity debt stock of any Group of Seven economy, with an average maturity of 14.4 years at the end of 2024. This reflects historic demand from British pension funds and life insurers which has faded significantly in recent years, prompting bond investors and dealers to recommend the DMO scale back long-dated issuance at a faster pace this year. Gilt prices rose sharply after the DMO announcement which showed slightly lower-than-expected planned overall gilt sales for 2025/26 - with 30-year gilts gaining the most. "I like it. There was no need for the DMO to issue so many longer-dated gilts," said James Athey, a fixed income manager at UK-based fund manager Marlborough. Thirty-year gilt yields hit their highest level since 1998 in January at 5.47% and at 5.30% still command a greater premium over short-dated gilts than is the case with U.S. bonds. "In a period of heightened uncertainty investors are increasingly looking to the short end of the curve as a safer play," Athey said. SHIFTING SHORTER Tilting issuance towards short-dated conventional gilts with a maturity of up to seven years - which will account for at least 37% of issuance in the coming year, up from 35% before - would also make it easier to hold larger auctions, Pulay said. Long-dated gilts are riskier for most investors than shorter maturities, so auctions for the former must generally be smaller. Pulay also highlighted an increase in the "unallocated" portion of gilt issuance which stands at 9% at the start of the 2025/26 financial year compared with 4% at the start of 2024/25. This would allow the DMO to respond to in-year changes in market demand for gilt "on a more regular and active basis", she said. Britain has generally attracted high demand for gilts at auctions and at bond syndications - several of which have attracted record volumes of orders this year, including for long-dated conventional and index-linked gilts. "High-quality institutional demand for long maturity gilts continues to be present," Pulay said. She also played down the risk that Britain would find it harder to sell debt as historically low issuers such as Germany ramp up borrowing to fund greater defence and infrastructure investment. "Sterling remains one of the leading global reserve currencies, and ... the results of our operations over the course of 2024-25 demonstrate very visibly the continued demand for sterling in general and for the gilt product in particular," she said. ($1 = 0.7764 pounds)
