Chartered Institute of Stockbrokers (CISI) Professional Practice Exam

Who issues Treasury bills and how often?

1. The Bank of England, annually

2. The Debt Management Office, weekly

3. The Treasury Department, monthly

4. The Financial Conduct Authority, quarterly

The correct answer is: The Debt Management Office, weekly

Treasury bills are short-term government securities issued by the Debt Management Office (DMO) on behalf of the UK government to finance public spending. The DMO conducts regular auctions to sell these bills, typically on a weekly basis. This frequency allows the government to manage its short-term funding needs efficiently and respond quickly to changes in financial conditions. The issuance of Treasury bills weekly ensures liquidity and accommodates the variability of government funding requirements. By maintaining this regular schedule, investors also find it easier to plan their cash management strategies, which contributes to a stable investment environment in the public debt market. The other options do not align with the actual issuer or the frequency of issuance for Treasury bills. The Bank of England, while involved in monetary policy, does not issue Treasury bills but rather deals with monetary policy operations. The Treasury Department is not the primary entity responsible for issuing Treasury bills, and quarterly issuance would not meet the government's short-term financing needs. Similarly, the Financial Conduct Authority, which regulates financial markets, does not engage in the issuance of Treasury bills.