What Is a Government Bond?
A government bond is a debt security issued by a government to support government spending and obligations. Government bonds can pay periodic interest payments called coupon payments. Government bonds issued by national governments are often considered low-risk investments since the issuing government backs them.
- A government bond represents debt that is issued by a government and sold to investors to support government spending.
- Some government bonds may pay periodic interest payments. Other government bonds do not pay coupons and are sold at a discount instead.
- Government bonds are considered low-risk investments since the government backs them. There are various types of bonds that are offered by the U.S. Treasury are considered to be among the safest in the world.
- Because of their relative low risk, government bonds typically pay low interest rates.
Government Bonds Explained
Government bonds are issued by governments to raise