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Economics vocabulary · Fiscal Policy and Public Finance

Government bond

Meaning in economics, with examples

nounCommon term

In economics, government bond means: A debt security issued by a government to borrow money; the government promises to pay interest and to repay the full amount on a set date.

In Turkish: devlet tahvili, hazine tahvili, DİBS

How it is used

Governments issue, sell or auction bonds; investors buy and hold them. Names differ by country: Treasuries in the US, gilts in the UK, Bunds in Germany. Securities that mature in under a year are usually called bills.

Example sentences

  1. The Treasury raised 20 billion lira at this week's government bond auction.

  2. Pension funds buy government bonds because they are considered safe.

Common collocations

  • issue government bonds
  • government bond auction
  • 10-year government bond
  • government bond market
  • bond yieldThe return an investor gets from holding a bond, shown as a yearly percentage; when bond prices fall, yields rise.
  • public debtThe total amount of money that a government owes to lenders at home and abroad, built up over years of borrowing.
  • budget deficitThe gap that appears when a government spends more than it collects in taxes and other revenue during a year; it is usually covered by borrowing.
  • defaultTo fail to pay interest or repay a loan or bond on time; the noun default describes this failure.
  • quantitative easingA policy in which a central bank creates new money to buy large amounts of government bonds or other assets, aiming to lower long-term interest rates.

This word in other fields

The same English word can have a different meaning in another field:

More terms: Fiscal Policy and Public Finance

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This page explains English vocabulary for learners. It is not financial advice.