Street Calls of the Week
LONDON - The United Kingdom Debt Management Office (DMO) completed an auction of £4.75 billion ($6.3 billion) of 4⅜% Treasury Gilt 2030 on Wednesday, with demand exceeding supply by nearly three times.
The auction saw bids totaling £13.3 billion, resulting in a coverage ratio of 2.8 times the amount offered. The DMO accepted bids at prices ranging from £101.109 to £101.141, corresponding to yields between 4.099% and 4.091%.
Bids at the lowest accepted price received a partial allotment of 27.89% of the amount requested, while competitive bids above this price were allocated in full. The non-competitive allotment price was set at £101.125, reflecting a yield of 4.095%.
Of the total amount, £4.04 billion was allocated to competitive bids, while £712.5 million went to gilt-edged market makers through non-competitive bids. An additional £0.001 million was allocated to other non-competitive bidders.
The auction resulted in a tail of 0.4 basis points, calculated as the difference between the yield at the lowest accepted price and the yield at the average accepted price.
The DMO also announced that an additional amount of up to £1.19 billion of the same gilt will be made available to successful bidders for purchase at the non-competitive allotment price, according to the terms outlined in the Information Memorandum.
Stock allotted to members of CREST will be credited to their accounts through member-to-member deliveries on the relevant settlement date, according to the press release statement.
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