The announcement of the details of the future New Zealand government bond (NZGB) programme may not be the most exciting or widely reported part of the Budget on 25 May. However, the bond programme and its composition can have significant implications for fixed income markets in New Zealand. The 2017 budget was no exception and following the release of the details of this year’s budget there were two key take-outs for fixed income investors:
The Government has committed to maintaining a functioning government bond market; and
The issuance of inflation indexed bonds would be set at NZ$1 billion of the planned NZ$7 billion issuance in the 2017/2018 budget year.