Another $5 billion worth of Treasury bonds to be issued

The Federal government is issuing up to another $5 billion worth of Commonwealth Securities.

The Treasurer Wayne Swan says it is doing this to “ensure the effective operation of Australia’s financial markets.”

These markets, of course, are under great pressure at present, as a result of the global economic crisis.

And Swan says his latest decision is a response to market demand.

“There has been strong demand for Australian Government Treasury Bonds in the wake of the global financial crisis,” he says.

That’s understandable.

These securities are, essentially, risk free.

And very little else is, at present.

Mr Swan admitted, though, that even the latest $5 billion worth of securities is not likely to satisfy the market for long.

“There continues to be strong demand for Treasury Bonds,” he says.

“And further issuance is likely to be necessary over coming months…,” he adds.

Swan says the government will continue to watch the market closely.