NZDMO trims $8b from bond programme
The office is slicing $2 billion from each of the next four years.
Hot Topic
Hawke’s Bay
The New Zealand Debt Management Office will cut $8 billion from its issuance programme through to 2020 as the government looks set to reduce debt.
The office is slicing $2 billion from each of the next four years, due to a "lower funding requirement," the DMO said in a statement. The office will raise $8 billion in the current financial year, falling to $7 billion in each of the subsequent four.
That will see $36 billion of new issuance over the five-year period and $31.4 billion repaid, leaving net bond issuance of $4.6 billion.
Finance Minister Bill English today unveiled his eight budget and slashed $400 million a year from the 2017 budget new spending allowance to help repay debt.
"We turned an $18.4 billion deficit in 2011 into a $414 million surplus last year, but a tight rein on spending is still required to start repaying debt," Mr English said in a statement.
Net debt is seen being $62.3 billion or 24.9% of gross domestic product, at June this year, lower than the $65.9 billion, or 26.9% of GDP, forecast six months ago. After peaking in 2018, net debt is forecast to fall back to $62.3 billion, or 20.8% of GDP, in 2020, down from last December's forecast of 24% of GDP.
(BusinessDesk)
Paul McBeth
Thu, 26 May 2016
Thu, 26 May 2016
© All content copyright NBR. Do not reproduce in any form without permission, even if you have a paid subscription.
NZDMO trims $8b from bond programme
58545