2024/25 New Zealand Government Bond Programme Set at NZ$40 Billion
In conjunction with the Half Year Economic and Fiscal Update 2024, the Treasury has updated the forecast core Crown borrowing programme.
The forecast 2024/25 New Zealand Government Bond (NZGB) programme has been increased to NZ$40 billion, NZ$2 billion higher than that published at the Budget Economic and Fiscal Update 2024. The forecast NZGB programmes for 2025/26, 2026/27, and 2027/28 have also been revised higher, by NZ$4 billion, NZ$6 billion, and NZ$8 billion respectively.
The 2028/29 year has been added to the forecast period, with a NZ$22 billion NZGB programme.
Short-term borrowings (Treasury Bills (T-Bills) and Euro-Commercial Paper (ECP)) at the end of 2024/25 are forecast to be NZ$20 billion. Short-term borrowings are forecast to decline to NZ$13 billion by the end of the forecast period.
Forecasts – New Zealand Government Bonds and Short-term Borrowings
| Year ending 30 June (face value) | 2024 (actual) | 2025 | 2026 | 2027 | 2028 | 2029 | Forecast period total |
|---|---|---|---|---|---|---|---|
| Gross NZGB issuance (NZ$ billion) | 39.3 | 40.0 | 40.0 | 38.0 | 28.0 | 22.0 | 168.0 |
| NZGB maturities and repurchases (NZ$ billion)1 | 18.8 | 21.3 | 16.5 | 22.6 | 15.9 | 18.5 | 94.7 |
| Net NZGB issuance (NZ$ billion) | 20.5 | 18.8 | 23.6 | 15.4 | 12.1 | 3.5 | 73.3 |
| NZGBs outstanding (NZ$ billion) | 172.9 | 191.7 | 215.2 | 230.6 | 242.7 | 246.2 | n/a |
| NZGBs outstanding (% of GDP) | 42% | 45% | 48% | 49% | 49% | 48% | n/a |
| Forecast short-term borrowings (NZ$ billion) | 19.0 | 20.0 | 20.0 | 18.0 | 13.0 | 13.0 | n/a |
- Includes NZ$5 billion per annum repurchases of bonds from the Reserve Bank of New Zealand held under the Large-Scale Asset Purchase programme until 2026/27.
Further Details
- Subject to market conditions, it is expected that two further tap syndications of existing nominal bond lines will be executed before the end of the fiscal year. The first will be a tap syndication of the existing 15 May 2035 nominal bond, in the March 2025 quarter. Further details will be announced in subsequent updates.
- For the second tap syndication, further details, including the specific bond line, will be announced in subsequent updates.
- Gross issuance into inflation-indexed bonds (IIB) is expected to be less than NZ$1 billion in 2024/25, subject to market conditions and indicated demand from market participants.
- The composition of short-term borrowings will include a minimum of US$3 billion of ECP and NZ$3 billion of T-Bills. The balance of short-term borrowings will be a mix of ECP and T-Bills, depending on relative cost and market dynamics.
- A flexible approach to short-term borrowing will continue to be taken in the annual borrowing programme. Actual issuance of short-term borrowings may vary from forecast, based on realised short-term cash needs. Intra-year, short-term borrowings on issue are expected to vary from NZ$10 billion to NZ$25 billion during normal market conditions.
- As previously announced, the January 2025 tender schedule will be published at 8am (NZT) on 18 December 2024.
ENDS
Treasury Contacts
Kim Martin | Director, New Zealand Debt Management
Tel: +64 4 890 7274
Paxton McKenzie | Head of Funding, Investment and Markets
Tel: +64 4 917 6925