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Gilts issue total lifted to £7bn
16 Jun 2009The Government was today issuing a bumper £7 billion of 25-year bonds as it attempts to fund the country's soaring debts.
The sum was increased from the £5 billion expected last night after bids this morning flooded in totalling £10 billion - signalling the continued robust demand for British corporate debt.
To make sure there were enough takers, the Debt Management Office hired Barclays, Goldman Sachs, HSBC and RBS to help manage the sale in what is the first syndication of a government debt auction in four years.
However, there are few reasons to be cheering about the need to issue such huge swathes of debt to fund the country's huge budget deficit. The Government plans to raise £220 billion this year.
Today's issue was priced to yield 11 basis points, or 0.11%, above the benchmark gilts price - lower than the original yield of up to 15 basis points.
