By Emese Bartha
Lower economic growth and increased expenditure on government bonds weigh on Sweden’s central budget, leading to lower surpluses this year and next, the Debt Office said in its borrowing review on Tuesday, which raises short-term debt issues but leaves domestic bond issuance unchanged.
“After very high growth last year, the war in Ukraine is slowing growth internationally and in Sweden, at the same time as inflation is rising,” said NDO.
NDO expects that Sweden’s gross domestic product will grow by 2.2% in 2022, a decrease from 3.2% it saw earlier, while it left the GDP forecast unchanged at 1.8% in 2023.
NDO sees Sweden’s budget surplus of SEK 102 billion ($ 10.40 billion) in 2022, a decrease from SEK 139 billion as seen in its previous review in February. It sees a surplus of SEK 75 billion in 2023, a decrease from the previously expected SEK 90 billion, it is said.
The Debt Office left the issue of nominal government bonds unchanged at SEK 46 billion in 2022 and SEK 40 billion in 2023. It also left the planned issue of inflation-linked bonds unchanged at SEK 9 billion this year and also at SEK 9 billion next year.
“In accordance with the Debt Office’s strategy to first adjust short-term borrowing, the volume of treasury bills is adjusted upwards,” said NDO, adding that it also plans to issue bonds in foreign currency in 2022.
Write to Emese Bartha at [email protected]