By Paul Vieira


OTTAWA--Canada said Tuesday its bond issuance over the next 12 months would be among the largest for a one-year period outside of the pandemic, with an increased focus on selling longer-term debt.

In its annual budget plan, Canada said it expects to issue 228 billion Canadian dollars, or the equivalent of US$165 billion, in bonds during the current fiscal year, ending March 31, 2025. This marks an increase from C$204 billion from the fiscal year just completed and C$185 billion from the 2022-23 period.

At the peak of the pandemic, during the 2020-21 fiscal year, Canada issued C$370 billion in bonds.

"Borrowing needs are expected to remain elevated to fund maturing debt and financial requirements," according to documents outlining Canada's debt-management strategy. "Given the uncertain path of interest rates, the borrowing program is focused on reducing refinancing risk and minimizing volatility to public debt charges."

Public debt charges are set to climb this year to 1.8% of gross domestic product from a 1.6% share in 2023-24. The government expects the 1.8% share of GDP to hold steady for the remainder of the horizon period, ending 2028.

Canada intends to issue C$76 billion in 10- and 30-year debt over the next 12 months, compared with C$61 billion in the previous fiscal year. Overall, the share of debt issued at maturities exceeding 10 years is set to rise to 33%, from 30% in the previous year.

According to government projections, Canada expects the yield on its 10-year bond to be close to 3.3% over the next half decade.

Issuance of five-year bonds is also set to increase, to C$60 billion this fiscal year from C$47 billion in 2023-24. Meanwhile, Canada said treasury-bill issuance is likely to hit C$272 billion over the next 12 months, or largely unchanged from the previous year.

Total stock of Canadian market debt is expected to climb in 2024-25 to C$1.441 trillion. In the fiscal year prior to the pandemic, Canada's total market debt was C$765 billion.


Write to Paul Vieira at paul.vieira@wsj.com


(END) Dow Jones Newswires

04-16-24 1618ET