UK to raise £4.25 billion in first debt syndication since budget
The Debt Management Office’s offering will raise £4.25 billion at a price of 4 basis points over comparable notes
THE UK received more than £65 billion (S$110.12 billion) of orders for an inflation-linked bond maturing in 2054, in the first syndication since last month’s budget.
The Debt Management Office’s offering will raise £4.25 billion at a price of 4 basis points over comparable notes, according to people familiar with the matter who asked not to be identified.
Megum Muhic, a strategist at RBC, had anticipated strong demand, citing the relative cheapness of the debt on various measures.
UK 10-year yields had climbed to a one-year high at 4.59 per cent in the wake of the budget on Oct 30 after Chancellor of the Exchequer Rachel Reeves announced the second-largest issuance plan on record. The benchmark has fallen since then to trade at around 4.36 per cent on Tuesday (Nov 26).
The last syndicated bond sale in September for a 2040 note attracted record-matching demand of over £110 billion. Such debt syndications are typically more expensive than auctions, but they allow governments to raise large sums quickly while diversifying their investor base.
Bookrunners on the new deal are Barclays, Bank of America, Citigroup and NatWest Markets. BLOOMBERG
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