CashNews.co
(Reuters) -Britain attracted a record 110.7 billion pounds ($145 billion) of orders for a new 15-year gilt at a syndication sale on Tuesday, as investor appetite for British government bonds remained strong after the change of government in July.
The DMO said it would sell 8 billion pounds of bonds via the sale, a larger sum than it had expected. The debt has a coupon of 4.375% and matures in January 2040.
In June, a 10-year gilt sold via syndication also attracted orders of around 110 billion pounds.
Investors have been attracted to UK bonds which have relatively high yields, driven in part by expectations that the Bank of England will cut interest rates by less than the U.S. Federal Reserve or European Central Bank over the next year.
Regular weekly gilt auctions have similarly shown no shortage of bidders – something that will may reassure finance minister Rachel Reeves as she readies tax and spending plans for her first budget, due on Oct. 30.
The DMO said domestic investors accounted for only 73% of the sale allocation – a lower share than normal, indicating stronger foreign demand for gilts. Typically domestic investors account for 80-90% of demand.
“It was particularly encouraging to witness such a broad range of high-quality investors participating in today’s offering,” said DMO chief executive Jessica Pulay.
The DMO said the sale price was 100.351, equivalent to a yield of 4.3438%.
($1 = 0.7630 pounds)
(Reporting by Andy BruceEditing by William Schomberg)