Government Bond Yield
Short definition
The government bond yield is the yield to maturity on Treasury paper. Local WACC usually takes rf from this curve, not from the policy rate.
Detailed explanation
The benchmark bond is a liquid point, not the whole curve. Inflation and CDS shift the yield. Real yield is read after expected CPI.
Corporate bonds = Treasury + credit spread. The bank loan fix may be TLREF, not the bond; do not mix them.
Why it matters for the CFO
CAPM and DCF use the benchmark as rf. The wrong tenor discounts long cash at a short rate.
How to read it
A yield rise can be inflation, supply or sovereign risk. It is not labelled “rates” until it is read with CDS.
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Definitions are educational. They are not investment, credit or tax advice.