This is how we borrow

The Debt Office borrows money on behalf of the Swedish government by selling government securities, primarily bonds. Parties that buy bonds are lending money to the government.

Central government debt is therefore financed via a large number of bonds sold by the Debt Office by means of an auctioning process. The bonds can then be resold on a secondary market. When a bond matures, the Debt Office pays back the money to the owner of the bond. Then we borrow again by selling new bonds.

Who do we borrow from?

The Debt Office sells bonds via dealers (various banks) who place bids in our auctions in the form of interest. The party offering the lowest interest is allocated bonds first.

Buyers can be both Swedish and international pension funds, insurance companies, banks, funds and central banks. But we have no information on who ultimately buys the bonds, as they are traded on a secondary market. The bonds often change ownership a number of times before they mature.

Private individuals can also contribute to the financing of central government debt by purchasing lottery bonds and placing money in account-based saving run by the Debt Office: National Debt Savings.

How much do we borrow?

The extent of the Debt Office's borrowing is mainly dependant on the development of the central government budget. When there is a deficit in the central government budget, we borrow money, which in turn increases central government debt. If there is a surplus in the budget, we amortise or pay back loans, and the central government debt decreases. But irrespective of whether we have a deficit or surplus in the central government budget, we need to borrow in order to replace loans that mature.

The development of the budget balance from one year to the next is largely determined by Sweden's economic growth. Growth primarily has an effect on government tax revenue, though it also affects the size of government payouts for e.g., compensation for the unemployed.

Every month, we present the outcome of the central government budget. As our activities involve borrowing, we refer to the budget balance as the net borrowing requirement. In connection with the outcome, we report on the size of the central government debt. Net borrowing requirement, monthly outcome

In order to plan the Debt Office's borrowing, we perform forecasts of central government net borrowing requirement and publish them in the report Central Government Borrowing - Forecast and Analysis three times per year.

What kind of government securities do we sell?

The Debt Office does not only sell government bonds; it also sells treasury bills (known as T-bills), inflation-linked bonds and bonds in foreign currency. The borrowing requirement and the guidelines decided on by the government determine how we distribute the borrowing between different types of government securities.

The guidelines govern the maturity of central government debt (how long loans will be bound on average) and its composition (how much will be nominal krona debt, inflation-linked krona debt and foreign currency debt). Based on this, we can work out an appropriate plan for the financing of central government debt.