Australian Government, the Australian Office of Financial Management

Commonwealth Government Securities

The Australian Government currently issues Commonwealth Government Securities (CGS) in the form of Treasury Bonds, Treasury Indexed Bonds and Treasury Notes.

There are currently 19 Treasury Bond lines, and 6 Treasury Indexed Bond lines on issue. The number of Treasury Note lines varies throughout the year in accordance with the Australian Office of Financial Management’s (AOFM) cash management operations.

Features of CGS

  • AAA rated.
  • The most liquid single debt market in Australia.
  • One of the highest yielding sovereign securities markets in the Organisation for Economic Co-operation and Development (OECD).
  • Interest payments on Commonwealth Government Securities are eligible for exemption from non-resident interest withholding tax (IWT). See AOFM Operational Notice 27/2009.
  • Easy access to quoted yields for nominal bonds at The Reserve Bank of Australia (RBA).

Securities on issue

The amount of CGS on issue is located under Commonwealth Government Securities on Issue on the AOFM website home page.

Non-resident holdings of Commonwealth Government Securities (Treasury Bonds, Treasury Indexed Bonds, Treasury Notes)

The proportion of Commonwealth Government Securities (Treasury Bonds, Treasury Indexed Bonds and Treasury Notes) held by non-residents has fallen from 72.2 per cent in the September 2012 quarter to 69.8 per cent in the December 2012 quarter.

Link to text description of the non-resident holdings of Commonwealth Government Securities figure

Chart construction (for information):

The proportion of non-resident holdings of Commonwealth Government Securities (CGS) is calculated using data sourced from the Australian Bureau of Statistics (ABS) and the AOFM.   

In order to arrive at the proportion of non-resident holdings, the following methodology is used.

  • The market value of non-resident holdings of CGS is sourced from the ABS website: see 5302.0 - Balance of Payments and International Investment Position and ensure that you have selected the latest release. Go to the Downloads tab and select Table 30 - FOREIGN DEBT LEVELS - QUARTER. The series of interest is that labelled Liabilities, Public sector, General government, Debt domiciled in Australia.
  • The market value of total CGS on issue can be found on the AOFM website under Statistics then  Overview of Portfolio. On this page open up the PDF link and look at page 2, Overview of Debt & Assets Managed by the AOFM - Market Value, then sum the amounts as given for Treasury Bonds, Treasury Indexed Bonds and Treasury Notes to obtain the market value for total CGS on issue for the relevant quarter.
  • The proportion of non-resident holdings of CGS is therefore the result of dividing the ABS sourced value for non-resident holdings by the AOFM sourced value for total CGS on issue.  Multiply this result by 100 to obtain the percentage value. It is important to note that both these values are based on market value.

That is,

Proportion of CGS held by non-residents   = Market value of non-resident holdings of CGS (from ABS)

Market value of total CGS on issue (from AOFM)
x 100

http://i.creativecommons.org/l/by/3.0/88x31.png

 

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