In-depth analysis of the outcome in March – lower interest rate payments on central government debt

24 April 2012

The net borrowing requirement in March was SEK 1.1 billion lower than our previous forecast. The difference is mainly explained by lower interest rate payments on central government debt due to exchange rate gains. The primary borrowing requirement, i.e. the net borrowing requirement excluding interest rate payments, developed in line with our forecast. In this in-depth analysis the outcome for March is compared with our latest forecast published in Central Government Borrowing – Forecast and Analysis 2012:1 on 6 March.

Tax income was SEK 2.9 billion higher than forecasted for March. This is mainly due to higher income from taxes on consumption and higher additional taxes from households and corporations. Taxes on corporate profits and taxes on wages showed comparatively small deviations.

It is still too early to say whether the forecast deviation is due to a stronger economic development. The most likely explanation is shifts in payments between months.

Disbursements from government agencies were higher than forecasted for March. These were minor differences among a number of authorities which together have an effect on the borrowing requirement. This cannot be interpreted as a permanent increase in expenditure related to the underlying economic development. Probably it is largely due to shifts in payments between months.

The Debt Office's net lending to authorities developed in line with forecast.

Interest rate payments on the central government debt in March were SEK 1.2 billion lower than calculated. This is mainly explained by higher exchange rate gains due to rollovers with derivatives in our benchmark portfolio.

Differences outcome net borrowing requirement March 2012

All values in SEK billion and in net borrowing requirement terms. A positive value means that the government has to borrow more than expected.

Tax income -2.9
   Wage based taxes -0.4
   Consumption based taxes -1.5
   Corporate taxes 0.9
   Additional taxes -1.8
Transfer payments 0.1
Dividends/Sale of state assets 0.3
Miscellaneous 2.3
Net lending 0.4
Interest rate payments -1.2
Sum -1.1