That's because longer term bonds
require people to lock their money up for a greater period of time -- and investors want to be compensated for that risk.
The Long-term 'AA'/Stable Outlook ratings assigned to the series G-3 and G-3A Floater and Residual Certificates and Custodial Receipts are based on the higher of the ratings that Fitch has assigned to the State of Connecticut General Obligation Bonds (2015 Series B)5.00% term bonds
due June 15, 2028 (G-3)and the State of Connecticut General Obligation Bonds(2015 Series B)5.00% term bonds
due June 15, 2029 (G-3A) (rated 'A+'/Stable Outlook) deposited with the custodian and the irrevocable direct-pay letters of credit (LOC) issued by Royal Bank of Canada, acting through a New York branch (RBC, rated 'AA/F1+'/ Stable Outlook), which have a stated expiration date of June 7, 2019, unless such date is extended or earlier terminated, which secures the custodial receipts deposited in the trust.
At the same time however an increase in the depth of Cypriot bonds in the markets might constitute a reason favourable to going ahead with a bond issuance as well as the further normalisation of the maturity profiles through repurchasing or exchanging short term bonds
with longer term bonds
and Adjunct Professor of Finance at DePaul University, released new findings that show that investors with significant exposure to long term bonds
may be able to protect themselves through allocations to commodities—in particular, via exposure to the oil-related energy sector.
Considering that foreign investors are mostly interested in long- term bonds
, the 10-year auction results can provide some color regarding foreign investor appetite.
Finance Minister Charilaos Stavrakis announced on Tuesday that the Government will issue new long term bonds
to the international markets around mid January in order to meet public needs for the 2010, which approach 2.5 billion euros.
The bank will exchange bonds issued in 2006 that mature in 2016 and which are trading below face value for shorter term bonds
that mature in 2012 in a move to strengthen its balance sheet.
Yields on long term bonds
are higher than yields on short term bonds
; with the yield on the 3 month T-bill hovering around 5.07% well above the 4.7ish range of the 10 year note.
The Long-term 'AA'/Stable Outlook ratings assigned to the series G-1 and G-2 Floater and Residual Certificates and Custodial Receipts are based on the higher of the ratings that Fitch has assigned to the State of California Tax-Exempt Various Purpose General Obligation Refunding Bonds 5.00% term bonds