treasury bond: meaning, definition, pronunciation and examples
C1Formal, Technical, Business, Financial
Quick answer
What does “treasury bond” mean?
A long-term, fixed-interest debt security issued by a national government to finance its spending.
Audio
Pronunciation
Definition
Meaning and Definition
A long-term, fixed-interest debt security issued by a national government to finance its spending.
A specific class of U.S. government security with a maturity of 20 to 30 years, considered a benchmark safe investment. Can also refer broadly to similar long-term sovereign debt instruments in other countries.
Dialectal Variation
British vs American Usage
Differences
In the UK, 'gilt' or 'gilt-edged security' is the more common term for UK government bonds. 'Treasury bond' is understood but typically used in an international or US context. In the US, 'Treasury bond' (or T-bond) is the standard term.
Connotations
In the US, it connotes the safest, most liquid long-term security. In the UK, using 'Treasury bond' might specifically refer to US debt or be used in global finance discussions.
Frequency
High frequency in US financial contexts; moderate frequency in UK financial contexts, often when discussing US markets or global fixed income.
Grammar
How to Use “treasury bond” in a Sentence
[investor/entity] + bought/sold/issued + [number] + treasury bondsThe yield on + [treasury bond] + rose/fell[treasury bond] + matures in + [year]Vocabulary
Collocations
Examples
Examples of “treasury bond” in a Sentence
adjective
British English
- The treasury-bond market was volatile.
- He has a treasury-bond-focused portfolio.
American English
- The Treasury-bond auction results were released.
- She recommended a Treasury-bond ladder strategy.
Usage
Meaning in Context
Business
The pension fund allocated 40% of its portfolio to long-dated Treasury bonds for stability.
Academic
The study analysed the term structure of interest rates using Treasury bond yields from 1980 to 2020.
Everyday
My grandfather's savings are mostly in Treasury bonds because he doesn't like risk.
Technical
The off-the-run 10-year Treasury bond's yield serves as a critical benchmark for mortgage-backed securities pricing.
Watch out
Common Mistakes When Using “treasury bond”
- Incorrect plural: 'treasuries bonds' (correct: 'Treasury bonds').
- Using 'Treasury bond' for short-term debt (which is a T-bill).
- Misspelling as 'treasure bond' (confusing with 'treasure').
FAQ
Frequently Asked Questions
While considered virtually free of default risk (for governments like the US), Treasury bonds carry interest rate risk (prices fall when rates rise) and inflation risk.
Yes, in many countries, individuals can buy them directly from the government (e.g., via TreasuryDirect in the US) or through brokers and banks.
It refers to the most recently issued bond of a particular maturity. It is typically the most liquid and actively traded.
Yields are primarily determined by auction, where investors bid. The yield moves inversely to the price and reflects market expectations for interest rates, inflation, and economic growth.
A long-term, fixed-interest debt security issued by a national government to finance its spending.
Treasury bond is usually formal, technical, business, financial in register.
Treasury bond: in British English it is pronounced /ˈtrɛʒəri bɒnd/, and in American English it is pronounced /ˈtrɛʒəri bɑːnd/. Tap the audio buttons above to hear it.
Phrases
Idioms & Phrases
- “As safe as a Treasury bond”
- “The bond market's bedrock”
Learning
Memory Aids
Mnemonic
Think of the national TREASURY giving you a written BOND (promise) to pay back your loan with interest over a long time.
Conceptual Metaphor
A LOAN TO THE GOVERNMENT (The investor is the lender, the government is the borrower). A SAFE HARBOUR in a stormy market.
Practice
Quiz
What is the primary distinction between a Treasury bill and a Treasury bond?