The gross volume of government borrowings in the domestic market of the Russian Federation in 2020, according to the Ministry of Finance, will amount to 5-5.5 trillion rubles. Despite some cooling in demand from non-residents, the Ministry of Finance has so far managed to borrow large volumes, providing increased budget expenditures, said the head of the department Anton Siluanov.
“This year we will be guided by our planned values – more than 5 trillion rubles, I think, from 5 to 5.5 trillion rubles (gross borrowings). Everything will depend on how income will be received this year. our expectations, we will be able to reduce the volume of borrowings, but the volume will be unprecedented, of course, this will double the level of last year, “Siluanov told reporters on Wednesday.
“We will fully finance our program,” he added, reminding that recently the Ministry of Finance borrows “quite a lot – under 150-200 billion rubles (in one day during the auctions for the placement of OFZs).”
The decrease in demand for floating coupon securities pushed the Ministry of Finance to increase the supply of floaters. “Basically, of course, there are securities with a floating coupon: with a fixed coupon, which was previously the focus of non-residents, there is less demand. Indeed, non-residents now participate less, there are even auctions when non-residents do not participate in the purchase of securities. Therefore, we are placed in mainly on securities with floating coupons, “Siluanov said.
“Nevertheless, the volume of borrowings has increased, and we plan in such a way as to fully finance the increased costs,” he said.
Next year, the gross volume of borrowings will be just below 4 trillion rubles, Siluanov said. “But if the conjuncture (global commodity markets) is better, we will participate less in the market,” the minister added.
On the day of Siluanov's meeting with journalists, the Ministry of Finance, following the results of three auctions, placed OFZs for 164.2 billion rubles, thereby fulfilling the quarterly plan by 94.2%.
Excluding the latest auctions, the Ministry of Finance of the Russian Federation in the third quarter placed OFZs for 778 billion rubles (including for 158.5 billion rubles and 215.4 billion rubles for the two previous weeks). Taking into account the latest placements, in order to fulfill the quarterly plan of 1 trillion rubles, the department needs to place government bonds for only 58 billion rubles during the remaining two auction days (September 23 and 30). Thus, there is a high probability that the Ministry of Finance's internal borrowing plan for the 3rd quarter will be overfulfilled, despite the fact that in mid-August the department was forced to abandon the auctions due to increased volatility (on August 12, the auction was declared invalid, and 19 August, the Ministry of Finance did not hold auctions at all).