Poland’s borrowing coverage rises to 68%

Poland’s Finance Ministry covered 68% of its original PLN181.7bn borrowing target for 2018, up from 67% at end-July, according to a comment from Deputy Finance Minister Piotr Nowak. But in its 2019 state budget draft, the FinMin lowered its target to PLN159.5bn, and the borrowing total covers 78% of that mark. Nowak said that pre-financing of the planned 2019 gross borrowing target of PLN163.7bn was 6%, financed via switching bond auctions.

The FinMin said separately that it would hold one T-bond auction in September, planning to offer PLN3bn-6bn of 5-7 series of bonds on Sep 6. The ministry will also hold a switching bond auction on Sep 20, with two series of bonds due in 2019 to be bought back early and thus continue pre-financing of its 2019 budget needs. No T-bill auctions are planned in September. Nowak also said the ministry had PLN52bn in its accounts at end-August.

Overall, the Finance Ministry continues to easily finance its 2018 borrowing needs and has already begun pre-financing 2019 needs. The 2019 borrowing total is to rise slightly from 2018, but not in a way that should imperil financing, unless global markets saw major dislocations.

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