The Debt Office will reduce borrowing needs as a result of higher budget surpluses in 2022
By Emese Bartha
Sweden’s economy will continue to grow at a good pace in 2022 despite a setback at the beginning of the year, which contributes to a further strengthening of central government finances and to lower indebtedness, the Debt Office said in a loan review on Thursday.
“The stronger budget balance means a lower borrowing requirement and the Debt Office therefore reduces borrowing once again,” says NDO.
NDO expects Sweden’s budget surplus of SEK 139 billion ($ 14.79 billion) in 2022, up from its previous forecast of SEK 94 billion in October. For 2023, a budget surplus of SEK 90 billion is expected, compared with the previous forecast of SEK 107 billion.
NDO expects that Sweden’s gross domestic product will grow by 3.2% in 2022, down from an earlier estimate of 3.5%, it says.
The Debt Office reduced the annual issue target for nominal government bonds to SEK 46 billion from SEK 50 billion in 2022 and to SEK 40 billion from SEK 50 billion in 2023, it is said. To reflect the lower borrowing requirement, the supply of nominal government bonds will be reduced to SEK 2 billion, an auction from SEK 2.5 billion starting in August.
The issue volume of inflation-linked bonds decreased to SEK 9 billion in 2022 from SEK 13 billion for each of 2022 and 2023, it added.
In the short-term borrowing, the treasury bill will decrease for 2022 and 2023, said NDO, which also decided to suspend the issue of bonds in foreign currency planned for this year, it is said.
Write to Emese Bartha at [email protected]