Government Securities

Debt financial instruments issued by a national government, through its executive authority, to raise funds for public spending, refinance existing debt, or cover temporary budget deficits. These securities are generally considered low-risk because they are backed by the government’s creditworthiness and ability to levy taxes. They can be issued in various forms, primarily: government bonds – long-term debt securities with maturities typically exceeding one year, paying periodic interest (coupons) and returning the principal at maturity; and treasury bills – short-term debt securities with maturities of up to one year, usually issued at a discount and redeemed at face value.