imported>Doug Williamson |
imported>Doug Williamson |
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| | ''UK - Bank of England.'' |
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| Most commonly, UK central government debt.
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| | Monetary policy is central government or other policy to stimulate or otherwise influence economic activity by influencing money supply or interest rates. |
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| Also known as Gilt-edged securities, or Gilt-edged stock.
| | Responsibility for setting UK monetary policy - to achieve monetary stability - lies with the Bank of England's Monetary Policy Committee (MPC). |
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| | | With effect from September 2016, the MPC meets eight times a year to set and announce the Official Bank Rate. |
| :<span style="color:#4B0082">'''''Example 1: Short-dated Conventional gilt'''''</span>
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| :An example of a short-dated conventional UK gilt is the 2% Treasury Gilt 2020.
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| :Each £100 gilt repays £100 to the owner on 22 July 2020.
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| :It will also pay interest on 22 July 2020, calculated at 2% per year. It was originally issued in 2014.
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| :It pays a predetermined fixed amount of interest (2% per year) throughout its whole life.
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| :It will be repaid at a fixed amount of £100 at its maturity on 22 July 2020.
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| :Whatever happens to inflation in the meantime, these amounts will not change.
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| :<span style="color:#4B0082">'''''Example 2: Long-dated Conventional gilt'''''</span>
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| :A very long dated conventional gilt is the 4% Treasury Gilt 2060.
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| :It will pay interest at 4% per year until 2060.
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| :<span style="color:#4B0082">'''''Example 3: Index-linked gilts'''''</span>
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| :Index-linked gilts pay out larger amounts, the higher the rate of inflation.
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| :The 'index' they are linked to is the UK Retail Prices Index (RPI).
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| :About 25% of UK gilts are index-linked, with 75% being conventional.
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| Historically, gilts were printed on gilt-edged paper (heavy bond paper with a metallic edge, usually gold-leaf or gold paint).
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| The heavy expensive looking paper was designed to give confidence in the promise.
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| The term 'gilt' is also used to refer to the debt of certain other central governments, especially US government [[treasury securities]].
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| == See also == | | == See also == |
| * [[Bill]] | | * [[Bank of England]] |
| * [[Bond]]
| | * [[Monetary policy]] |
| * [[Bund]]
| | * [[Official Bank Rate]] |
| * [[Exempt gain]]
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| * [[G+]]
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| * [[ILG]]
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| * [[Index-linked gilt]]
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| * [[Paper]]
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| * [[Risk-free rate of return]]
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| * [[Semi-annual rate]]
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| * [[Sovereign]]
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| * [[Stock]]
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| * [[Swap spread risk]] | |
| * [[Tap stock]] | |
| * [[Treasury]]
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| * [[United Kingdom]]
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| [[Category:Corporate_financial_management]]
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UK - Bank of England.
(MPC).
Monetary policy is central government or other policy to stimulate or otherwise influence economic activity by influencing money supply or interest rates.
Responsibility for setting UK monetary policy - to achieve monetary stability - lies with the Bank of England's Monetary Policy Committee (MPC).
With effect from September 2016, the MPC meets eight times a year to set and announce the Official Bank Rate.
See also
