Learning Module 5 Fixed-Income Markets for Government Issuers

Which characteristic most clearly distinguishes a sovereign government issuer from a non-sovereign (local or regional) government issuer?

Which of the following best describes a general obligation (GO) bond issued by a provincial government?

A sovereign treasury announces a new 30-year bond auction. Under a single-price (uniform-price) auction, which statement is true about winning bidders?

Which investor objective primarily explains why on-the-run government securities trade at slightly lower yields than off-the-run securities with similar maturities?

Which of the following best describes external sovereign debt for an emerging-market government?

A sovereign issues short-term Treasury bills (T-bills) with maturities of 3 months, sold at a discount. Which is the most typical use of such short-term sovereign issuance?

Which of the following factors most directly increases the likelihood that an emerging-market sovereign might default on external, foreign-currency debt?

Which statement about government agencies (quasi-government entities) is most accurate?

Why might a sovereign debt manager choose to resume issuance of a 30-year bond after a period of suspension?

Which auction outcome is most likely to produce a narrower distribution of bidders concentrated in large offers?

If a sovereign government has rising near-term funding needs and limited immediate tax receipts, which policy action is the most likely near-term response to avoid rollover risk?

Which of these factors would reduce a sovereign issuer's ability to access long-term domestic-currency capital markets?

Which of the following best explains why governments maintain issuance across a range of maturities rather than relying solely on the shortest-term financing?

Which of the following is true about supranational organizations' borrowing and issuance characteristics?

Which investor would most likely be constrained from holding certain sovereign securities, creating 'non-economic' demand for those bonds?

In a sovereign auction, what is the difference between a competitive and a non-competitive bid?

Which type of government-issued debt is typically sold at a discount and has no periodic coupon payments?

Which of the following best describes an advantage of issuing benchmark government bonds across maturities?

Which of the following best explains why agency debt often trades at yields slightly wider than sovereign debt?

Which of the following best describes the primary dealer role in sovereign issuance?

Which of the following demonstrates why on-the-run government bonds serve as useful benchmarks?

Which of these best explains why a sovereign might guarantee but not issue certain asset-backed securities or mortgage programs?

Which of the following is a reason why a sovereign's domestic-currency bond market might be shallow for long maturities in an emerging market?

Which of the following statements about sovereign auctions and market distribution is correct?

Which of the following is a typical feature of supranational bond issues intended to attract international investors?

Which of the following differences between sovereign and corporate issuance and trading is emphasized in the chapter?

Which best describes a 'fallen angel' in sovereign or corporate bond markets as discussed in the chapter?

Which of the following best explains why sovereigns issue short-term bills even if long-term rates are temporarily lower?

Which of the following is most likely to increase the liquidity premium on a sovereign bond relative to similar bonds?

Which of the following best captures the relationship between fiscal policy and government debt level as described in the chapter?

Which of the following best explains why asset-backed commercial paper (ABCP) issuance fell after the Global Financial Crisis?

Which of the following is most likely to be true about a sovereign with a reserve-currency denomination (e.g., USD) in terms of borrowing costs and global demand?

Which statement best describes how sovereign agencies’ debt typically differs from the sovereign’s own debt in secondary-market liquidity and yield?

Which of the following best summarizes why public-sector balance sheets in many countries differ from private-sector GAAP financial statements and how that affects sovereign credit analysis?

A sovereign treasury wants to encourage a broad investor base in its new bond issue. Which auction design is most consistent with that objective?

Which of the following most accurately describes the role of sovereign bonds in repo and derivative markets?

Which of the following best captures why emerging-market sovereign domestic debt may be less attractive to foreign investors than external debt issued in a major currency?

Which of the following factors can cause government auction failures or partially failed auctions, prompting changes in auction methodology?

Which of these best describes why off-the-run sovereign securities typically yield more than on-the-run securities of the same maturity?

If a sovereign's auction announces a cut-off yield of 1.95% and then sets the coupon at 1.875% because yields are rounded down to the nearest 0.125%, what does this tell you about the auction process?

Which of the following best describes a revenue bond issued by a local authority?

Which of the following is a typical feature of supranational bond documentation intended to appeal to international investors?

Which of the following best summarizes the effect of sovereign reserve-holding by foreign central banks on sovereign bond yields?

Which of the following best describes why governments sometimes provide a committed backup line of credit to commercial paper programs?

Which of these is most likely to be considered an advantage for a sovereign that establishes a well-developed long-term government bond market?

Which of the following best explains a reason supranational organizations might issue local-currency notes but set payment amounts in a major currency using a spot rate mechanism?

Which of the following best describes why off-balance-sheet SPE arrangements for ABCP funding were attractive to banks before the Global Financial Crisis?

Which of the following best explains why sovereign debt denominated in a foreign currency poses a particular risk to domestic-currency taxpayers in an emerging market?

Which of the following is true regarding auctions and the treatment of non-competitive bids?

Which of the following best summarizes how supranational and sovereign support affected the issuance prospects of PT Indonesia Infrastructure Finance (IIF) in international markets as described in the chapter?