A government bond is a debt security issued by a national government to raise funds, typically offering a fixed interest rate paid annually or semi-annually for the life of the bond.
These bonds are considered low-risk investments because they are backed by the government’s credit and taxing power. Investors receive regular interest payments and are repaid the principal amount at the bond’s maturity, which can range from as short as one month to as long as 30 years.
Government bonds are often used to fund public projects or manage national debt and are popular among conservative investors seeking stable returns.