Another Day, Another £1.25 Billion

This is the latest announcement from the DMO, just a few minutes ago:

The government just borrowed money paying a rate of 4.36% shown here as the ‘Yield’. The UK government is borrowing money at a significantly higher rate than the set Bank of England rate of 1.5%, but they are not yet paying an exorbitant rate. The ‘Cover’ is the ratio of bids to the amount of money the government wishes to borrow. It was 1.31 for this auction, which is quite low by recent standards, but sufficient for the auction to succeed. If this number begins to fall below 1 regularly, then the government is unable to borrow money in your name to give to banks who lent money to dodgy Russian oligarchs and then never got it back.

UK DMO: PRESS RELEASE: 19 January 2009
RESULT OF GILT MINI-TENDER: up to £1,250million (nominal) of 4¼%
Treasury Gilt 2027
Striking price £98.56
Yield 4.362%
Scaling ratio applied to bids at striking price 10%
Cover 1.31x
Total bids received £1,643 million
Competitive bids allotted £1,250 million
Residual amount retained by DMO £0
Total amount issued £1,250 million


One response to “Another Day, Another £1.25 Billion

  1. Pingback: Gilt Strike « One Hundred Pounds

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