Yielding to Australian infrastructure needs
The Australian Office of Financial Management (AOFM) has
announced the Federal government's first 30-year bond. Sized at
A$7.6bn, and paying a yield to maturity of 3.27 per cent, the
benchmark transaction continues AOFM's strategy of developing
the long-end of the yield curve for Commonwealth Government
Securities (CGS).
This further extension of the CGS yield curve is clearly good
news for sponsors and market participants in infrastructure
projects looking for alternative funding options and structures,
but for whom the lack of an appropriate benchmark line at or around
the 30-year mark has been an inhibitor when considering long-term
bonds as a competitive part of the funding mix. Enabling long term
bonds to be priced, through new longer-dated benchmark lines, and
the associated promotion of market liquidity in these securities
through the concentration of issuance across those lines, is likely
to provide a real
