Central government payments gave a deficit in September

7 October 2010 - Press release

Swedish central government payments resulted in a deficit of SEK 15.4 billion in August. The Debt Office's forecast was a deficit of SEK 10.1 billion. The difference is mainly explained by larger interest payments on central government debt.

Interest payments on central government debt amounted to SEK 7.4 billion, which was SEK 5.8 billion more than forecasted. The difference is mainly explained by larger capital losses than expected. The reason is that we have made larger exchanges of inflation-linked bonds than calculated in the forecast. Furthermore the market yield on the inflation-linked bonds that we repurchased, were lower than at the time of the forecast.

The difference between the market price, what we pay for the repurchase in the exchange, and the nominal amount, is called capital loss. At the same time as we repurchase inflation-linked bonds with a high coupon rate in relation to the market yield and large accrued inflation compensation, we issue new inflation-linked bonds with a lower coupon rate and lower market price. Both capital losses and coupon rates are interest payments. The exchanges of inflation-linked bonds therefore mean a redistribution of interest payments over time.

Foreign exchange losses were also larger than calculated.

Remaining central government payments were largely in line with the forecast.

For the twelve-month period up to the end of September 2010, central government payments resulted in a deficit of SEK 31 billion. Central government debt amounted to SEK 1,082 billion at the end of September.

The outcome for October will be published at 9.30 am on 5 November 2010.

New revised forecasts for 2010 and 2011, along with our first forecast for 2012, will be published at 9.30 am on 16 November 2010.

 

Further information can be obtained from:
Håkan Carlsson, phone +46 8 613 47 33