Forecasts

The Debt Office makes forecasts on the Government’s net borrowing requirements. The purpose of the forecasts is to make it possible to plan the funding of the central government debt. In essence, they are forecasts of how much the central government debt will change, in other words how much extra money we need to borrow or pay back on our loans for a certain period.

The Government has many, often substantial, payments every day (when the banking system is open). We therefore produce a payments forecast for every bank day. The total of the forecasts for all the days over a given month is our monthly forecast and the total of the monthly forecasts over a year is our annual forecast.

We publish our forecasts in the report Central government borrowing – Forecast and Analysis three times a year. In this report we publish our annual forecast for the current year and the following year and our monthly forecasts for the next nine months.

When preparing these forecasts we use various sources including information on historical payment patterns, the state budget and assessments of the business cycle and economic growth from (in particular) the National Institute of Economic Research.

The Ministry of Finance, the National Financial Management Authority and the National Institute of Economic Research issue forecasts on the budget balance. Their information is mostly intended as a basis for following up the budget and political decisions.