The UK government dipped its toe back into the waters of the global debt markets today, selling £2.5bn of bonds at record low interest rates in the first auction since the referendum.
The debt, which came with a five-year maturity, will yield just 0.38 per cent in a sign investors are still keen to lend to the UK government despite its recent credit rating downgrade.
When the government last issued a five year bond, at the beginning of June, it was sold with average yield of 0.86 per cent - more than double today's rate.
Today's auction is the first since the referendum hiatus kicked in on 9 June in line with the Debt Management Office's strategy of making sure they only offer government debt at times when the market is most liquid.
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The bid-to-cover ratio, which calculates how many pounds of debt were bid for for every £1 on offer, came it at 1.8 - up from 1.6 in the early June auction - in a sign of healthy demand for government debt.
UK government debt is currently trading with record low yields, in a fall Mark Carney, governor of the Bank of England described as "remarkable". The yield on 10-year debt has fallen to 0.8 per cent, down from two per cent this time last year, while short-term debt edges closer and closer towards negative territory, with two-year bonds yielding just 0.14 per cent according to Bloomberg.
Asset managers Royal London said the current bond yields indicated the market was "fully priced for a deep recession [and] suggest that the 'flight to safety' could reach new heights."