Post sponsored by

Source: New Zealand Treasury:

In conjunction with the Budget Economic and Fiscal Update 2020, the Treasury has updated the forecast core Crown borrowing programme. The next update is expected to occur alongside the Pre-Election Economic and Fiscal Update (PREFU) 2020.

The impact of COVID-19 on the Crown’s fiscal outlook is unprecedented, and requires substantial increases to the forecast borrowing programme, relative to that forecast at the Half Year Economic and Fiscal Update (HYEFU) 2019.

The forecast 2020/21 New Zealand Government Bond (NZGB) programme is now set at NZ$60 billion. This is NZ$50 billion higher than forecast at the HYEFU 2019. The forecast bond programmes for the 2021/2022, 2022/2023 and 2023/2024 years have also been revised higher, to NZ$40 billion, NZ$35 billion and NZ$30 billion respectively.

Treasury Bills on issue are forecast to be NZ$10 billion at 30 June 2021, and at 30 June of each year in the forecast period.

Forecasts – New Zealand Government Bonds and Treasury Bills

Year ending 30 June (face value) 2020 2021 2022 2023 2024 Total
Gross NZGB issuance (NZ$ billion) 25.0 60.0 40.0 35.0 30.0 190.0

NZGB maturities and repurchases (NZ$ billion)

5.4 11.1 0.0 15.8 15.4 47.6
Net NZGB issuance (NZ$ billion) 19.6 48.9 40.0 19.2 14.6 142.4

NZGBs on issue (NZ$ billion)

90.2 139.1 179.1 198.4 213.0 n/a
NZGBs on issue (percent of GDP) 31% 47% 55% 56% 57% n/a
Forecast Treasury Bills on issue (NZ$ billion) 10 10 10 10 10 n/a

Further Details

  • Issuance for the remainder of 2019/20 is planned to be in line with the previously announced Government Bond Tender Schedule for May 2020, and the schedule for June 2020 that will be announced before the end of this month.
  • Subject to market conditions, it is expected that a new nominal NZGB will be launched, via syndication, between 30 June and 30 September 2020. The maturity will be confirmed ahead of syndication. A syndicated tap of an existing nominal NZGB is also expected to take place within this period.
  • These two syndications are in addition to the syndication of a new 15 May 2024 nominal NZGB that is expected to take place in June 2020, as announced on 29 April 2020.
  • Individual nominal NZGB tranche size caps have been increased to NZ$18 billion, from NZ$12 billion.
  • Issuance into inflation-indexed bonds is expected to be between NZ$1 billion and NZ$2 billion in 2020/21, subject to market conditions. Inflation-indexed bonds continue to be an important part of the core Crown borrowing programme.
  • Due to increased uncertainty in cash requirements, forecast cash balances are greater than at the HYEFU 2019, to help manage funding and liquidity risk. In addition, tools for managing short-term cash requirements include flexibility in Treasury Bills issuance, an active foreign currency Euro Commercial Paper (ECP) programme and a limited overdraft with the Reserve Bank of New Zealand.

RBNZ’s Large Scale Asset Purchase Programme

New Zealand Debt Management and the Reserve Bank are committed to collaborating closely to ensure the efficient functioning of the NZGB market. The Reserve Bank is working closely with New Zealand Debt Management when planning operations under the Large Scale Asset Purchase programme to achieve these objectives.


Treasury Contacts

Kim Martin | Acting Director, Capital Markets
Tel: +64 4 890 7274 

Matthew Collin | Head of Portfolio Management
Tel: +64 4 917 6015