Question:

How do you read this as an indicator of a hike at the upcoming June meeting? Historically the counter cyclical buffer has aligned relatively well with interest rate cycles - and given it was announced post the inflation data, would that not skew the risks for June much more hawkish?

The question was asked in relation to the following story: CNB raises countercyclical capital buffer by 25bps to 1.5% as of July 2027

Answer:

We don't see how an increase in the countercyclical capital buffer rate a year from now aligns with a policy rate hike in two weeks. Yes, it tends to indicate that the CNB is concerned lending activity is too strong and that monetary policy might not be restrictive enough to contain it. But we don't believe the timing of the buffer rate increase matches a shift in the interest rate cycle. In fact, we are starting to suspect that the CNB extended its announcement period, which is typically about 6 months, to disperse any idea that this may be related to a change in the policy rate.

Follow-up question:

But in the last three cycles, hasn't an increase in the buffer been followed by a rate hike in nearly all instances?

Answer:

However, each time it was also in an environment of accelerating inflation. Thus, we find the argument that the countercyclical capital buffer rate hike was a precursor for a policy rate hike as thin. It is far more reasonable to consider the capital buffer hike as an accompanying measure that would amplify monetary policy. Besides, the opposite has usually not been true, i.e. a reduction in the capital buffer rate has rarely led to a rate cut.

We would also like to point out that CNB board members have been mentioning during the past several MPC meetings how the interest rate channel was not as effective in dampening robust lending activity growth. The main reason is that corporations are borrowing a considerable amount of money in foreign currency, the ratio being at least at 47% of total corporate loans since mid-2023. Thus, you could make the argument that they are going for a capital buffer hike as they no longer believe a policy rate hike would be as effective.

Question:

Have you seen any comments from the CNB hinting at a rate hike in June? The FRA curve had a substantial move over the last two trading sessions and is currently pricing in 20bp for the June meeting. I suspect that there was an investor meeting or an investor call?

The question was asked in relation to the following story: Power consumption reports a modest increase in May

Answer:

If there has been an investor call or anything similar, it has not been a public one, as there is nothing even hinting such an event in local sources. We are aware markets are pricing in a rate hike for the MPC meeting, but there is no domestic development to justify it - at least one that we are aware of. Communication from the CNB board has remained cautious for now, and the latest CNB survey among financial markets reports a consensus about another hold decision, though the cut-off date was early last week.

At this point, we would attribute this mostly to the US-Iran conflict going on much longer than initially anticipated, especially after the latest developments in Lebanon, and the ECB signalling a rate hike soon. We have been arguing that markets are underestimating the impact from the crisis, and that rate hikes are inevitable this year, the only unclear part being the timing. As far as the ECB is concerned, many tend to believe that the CNB will follow closely the ECB, especially now, even though this has not always been the case. In all fairness, the CNB has never ruled out a hike in June, and all the messaging so far has been pointing that it will be a debate between stable interest rates and a rate hike.

As far as economic data is concerned, economic data available thus far does not suggest a rate hike is imminent. Fuel prices eased a bit in May, and have been relatively stable; no major energy price hikes have been announced, and offer prices were also relatively stable in May; agricultural producer prices have continued to fall sharply in April. There are concerns that price pressure will rise, but at least at this point, expectations are that inflation will pick up in H2. There is an in-built buffer for these commodities, as delivery contracts are usually 3 to 6 months in advance. Yet, with no normalisation in sight, it is hardly surprising that people are getting increasingly nervous. The way we see it, it is currently a staring contest, with producers and energy suppliers waiting who will pull the trigger first with price hikes so that they could quickly jump on the train.

In a nutshell, if there is some signalling that the CNB will finally deliver on its stated hawkish stance, it hasn't been made in public. We have been monitoring media sources that tend to have sources in the CNB, but there hasn't been anything to hint that.

Question:

There was also some rumors on CNB Governors hinting to rate hikes on their June meeting have you heard of such news and what do you make of it?

The question was asked in relation to the following story: Markets pricing rate hikes

Answer:

A rate hike is certainly possible, though communication from the CNB board so far has pointed more towards stable interest rates. Still, a lot will depend on inflation developments. If there are signs of second-round effects on inflation, then the CNB board is more likely than not to act. If nothing shows up in economic data, then the board could leave interest rates unchanged one more time. As far as rumours are concerned, there have been plenty of those over the years, and it won't be the first time when markets price in rate hikes (or cuts), but the CNB board doesn't act on it. Unfortunately, we don't have enough information to confirm or deny these rumours, though there is a certain degree of plausibility in those.

We should remind that our position since the beginning of the US-Iran war has been that rate hikes are inevitable this year, the only unknown is their timing. The odds of a long conflict in the Middle East are rising, which is in line with our original expectations, so pressure on inflation will only rise. Meanwhile, inflation in the euro area remains elevated, which will likely trigger a rate hike from the ECB soon. While the CNB does not follow the ECB's monetary policy that closely, this could be an indication that price pressure will keep rising, being a factor favouring a Czech policy rate hike.

Thus, the debate at the next MPC meeting will be between stable rates and a rate hike, likely a 25bp one. At this point, it is all very speculative, as there is no relevant economic data to point in either direction. The first piece of data is due on Thursday (Jun 4), when the flash CPI for May will be out. The only price data we currently have is fuel prices, and these have been relatively stable, even easing a bit recently. There is a possibility that food prices may start rising, but no evidence has been observed yet. We expect that transport and tourism prices will rise, but their impact is typically limited due to a low weight in the CPI. There have been no major announcements of energy price hikes so far, and offer prices were largely stable in May.

Again, all this doesn't rule out a hike in June, but there is nothing we have heard to corroborate these rumours, or at least not yet.

Question:

There seems to be a repricing of CZK rate hikes this year today. Any headlines driving this?

The question was asked in relation to the following story: Financial markets expect another hold decision from CNB in June

Answer:

The main reason for markets pricing in rate hikes is related to the length of the US-Iran war, and the rising odds that the conflict will continue longer than initially anticipated. In turn, this raises the likelihood that high oil and natural gas prices will cause second-round effects on domestic inflation, which will be more permanent and difficult to dampen than first-round effects (like high fuel prices).

There are two main channels where the Czech economy is exposed to second-round effects. One is energy prices, and the other - food prices. As far as energy prices are concerned, the Czech Republic relies heavily on natural gas for heating, and less so for power generation. There is also plenty of natural gas consumption for industrial use, and with prices remaining high, it will inevitably translate to higher production costs. At this point, we estimate that spot natural gas prices are higher by about 43.5% compared to the start of the war, while 1-year futures are pricier by almost 35%, so there is a significant price shock. Meanwhile, food prices are exposed mostly to fertilizer prices, whose prices have increased by around 18-20% in the Czech market, according to a recent survey. We estimate that agricultural producer prices could rise by about 5-10% in a moderate scenario, which could push headline inflation upwards between 0.7-0.8pps and 1.7pps.

Thus, the CNB is potentially looking at non-negligible second-round effects, which could keep inflation above the upper end of its tolerance band (2%+/-1pp) for a while. Thus far, the CNB board has been reluctant to act, given all the uncertainty. However, once second-round effects on inflation start being reported, it will probably have no choice but raise interest rates. The main price indicator to watch is core inflation, which is currently close to 3%. If core inflation exceeds 3%, and it appears a permanent acceleration, then rate hikes will immediately follow. The other indicator to watch is food prices. While these are not included in the core inflation measure, households have become very sensitive to food price hikes after the COVID-19 pandemic and the 2022 energy crisis. This could deanchor their inflation expectations from the inflation target, which is why we expect the CNB to act in that scenario as well.

Follow-up question:

I noticed that the 3x6s CZK FRAs moved up by 8bps today, but I haven't come across any headlines or news stories that would explain such a shift. My understanding was that the inflationary effects you described had already been priced in, so I'm curious if you're aware of anything that might have driven today's move in the rates. Would appreciate any additional insight if you have a sense of what might have happened today.

Answer:

We are not that confident that markets have fully priced in the potential inflation impact, at least not fully. Regarding both channels, there is an in-built buffer for both natural gas and fertilizer prices, as many of these deliveries have been negotiated months in advance. Thus, the full impact from high natural gas and fertilizer prices is only expected to occur in the second half of the year, possibly even in Q4. My point is that there is theoretically still some time for the price shock to be dampened, provided the conflict ends quickly, as suppliers could narrow profit margins a bit, for the sake of not losing market share.

Instead, we believe the recent market movement is likely related to the latest developments in the Middle East, namely the escalation of Israel's actions in Lebanon, rather than to anything domestic happening in the Czech Republic. This all goes towards the length of the US-Iran conflict, as the odds are that Iran would be less willing to make a deal when Israel is on the loose in Lebanon. Iranian representatives have threatened to block traffic through the Red Sea as well (likely using the Houthis), which will be an additional hit to supply chains.

Another factor could be the latest euro area inflation flash estimate, with euro area inflation picking to 3.2% y/y in May. This raises the odds of the ECB delivering a rate hike, and markets often expect the CNB will follow suit. Personally, we would not bet too much on such an assumption, which is why we didn't mention it at first. The CNB has been signalling that it is unlikely to follow the ECB closely, and rather look at effects to the Czech economy.

In any case, we don't see anything domestic that could provoke such a market shift. We could see something on Thursday (Jun 4), when the Czech flash inflation print will be published. As far as other domestic events that could be market-moving, we really cannot think of something significant.

Question:

Can I check if the SAFE loans still remain pending and have not yet been approved?

The question was asked in relation to the following story: EC to release recovery, cohesion funds for Hungary in case of reforms

Answer:

Yes, Hungary's SAFE absorption plan has not been approved yet, this is the EC SAFE portal where you can still see Hungary's plan listed as not approved. Neither EC President Ursula von der Leyen nor PM Peter Magyar have talked about it during last week's meeting, as far as we know. We expect that the general improvement in relations will certainly facilitate the approval of the SAFE package as well.

Question:

Can I please ask if you would have any estimate in cash value or in % of GDP of the fiscal cost spent to curb the impact of oil on inflation since the beginning of the conflict?

The question was asked in relation to the following story: Energy Ministry cuts petrol price cap by 1.7% and diesel one by 1.3%

Answer:

The FinMin's latest official estimate for the monthly cost of the tax cuts (here) is PLN 930mn for the reduction of the VAT on fuels to 8% from 23% and PLN 750mn for the cutting of the excise on petrol to PLN 0.29 a litre and on diesel to PLN 0.28 per litre, giving a total of PLN 1.68bn.

That works out to about 0.04% of GDP (using the government's latest forecast for 2026 dated April). The fuel tax cut measures have been in place since Mar 31. That means the cost is around 0.1% of GDP, or some PLN 3.7bn.

Question:

Where can I find the updated forecasts you mentioned in this article?

The question was asked in relation to the following story: FinMin Domanski says EC has accepted gradual deficit reduction path

Answer:

The forecasts were the ones approved by the government in late April as part of the Medium-Term Fiscal-Structural Plan. That plan is out in English (on the bottom of this page).

The latest macro forecasts are here, but for some reason, there is no translation. If you would like, I can send translations of each of the items in the "Prognoza MF" table on the left. To some degree, they can be interpreted in English with GG for general government. Let me know.

The next macro assumptions will be published by Jun 15 as part of the forecasts for the 2027 budget, though this won't include deficit figures. Then the FinMin will publish the first budget draft likely in late August or so, and that will have more forecasts and likely the general government deficit for 2027 as well. Following that, the government will approve an implementation report for its Medium-Term Fiscal-Structural plan in early October.

Question: Can I please ask if you would have any estimate in cash value or in % of GDP of the fiscal cost spent to curb impact of oil on inflation since the beginning of the conflict? Or is that Romania has fully removed all fuel price cap and fuel tax reduction since before the conflict and has since not reintroduced similar measures for the sake of fiscal consolidation?

The question was asked in relation to the following story: PPI inflation further speeds to 10.3% y/y in April, once more due to fuels

Answer: The government crisis regime on the crude oil and fuel market, meant to stabilise prices and protect supply, has been in force since April for a 6‑month period and therefore it is still active. The package limits commercial markups, restricts exports and reduces biofuel content. Officials have not provided estimates of this measure's fiscal impact, as that depends only on how much fuel players' profitability would be affected by those caps.

In parallel, the government approved RON 652mn compensations for transporters with diesel costs and a temporary reduction of diesel excise for farmers. Both schemes' combined impact was estimated to cost the state budget about 0.05-0.06% of GDP for the 6-month period.However, we think that the negative fiscal impact of those schemes should be offset by higher budget revenue from VAT on fuels, the result of higher prices.

Question: What do you think is Romanian political interest in Moldova reunification after the headlines about EU succession? What would be the effect on the Romanian economy of this?

The question was asked in relation to the following story: Press Mood of the Day

Answer: In our view, Romania's political interest is to keep the Moldova Republic firmly anchored on its EU accession path and protected from the Russian influence. A real reunification is not on the table at the moment, and we don't expect it to be soon, given the major economic impact in the short term, geopolitical implications (Moldova is a vulnerability for NATO due to the presence of Russian troops in Transnistria region), the legislative ambiguities (the EU treaty doesn't stipulate how such cases should be handled) and the lack of majority support of Moldova's population.

Moldova's GDP per capita is about one third of Romania's, so short‑term economic costs would likely be very high. Reunification would require large fiscal transfers, investment in roads, hospitals and schools, the absorption of Moldova's budget deficit and the integration of institutions, tax systems and social systems. In the long run, there could be potential benefits such as a bigger internal market, a bigger labour force, improved trade flows and higher geopolitical weight.

In Romania, polls show majority support for reunification among the population. However, political will is required to initiate such a process, and the political landscape is far from being aligned. The PNL sees reunification as a legitimate historical aspiration but not a current policy objective. The PSD rarely discusses the topic. The USR has expressed the most explicit support among mainstream parties for eventual reunification. The AUR treats it as a core ideological pillar, while the UDMR avoids the topic entirely.

Question:

Where can I find monthly oil production data for Tengiz, Kashagan, and Karachaganak?

The question was asked in relation to the following story: Tengiz operator says output close to regular levels

Answer:

The EnergyMin and the fields' operators do not publish such monthly data. The ministry stopped all monthly publications a couple of years ago, which coincided with reports of consistent overproduction under the OPEC+ deal. The operators tend to provide quarterly data. KazMunayGas may be the best source of combined production data on quarterly basis. Its Q1 presentation can be found here, with results for all three fields.

Question:

Have you done any reporting to cover the Q1 fiscal deficit and the reasons of it being so high? Why aren't authorities doing more to weaken the RUB given it would mechanically improve revenues and reduce the deficit? What would be historical precedents of decrees/measures that could be announced to weaken RUB?

The question was asked in relation to the following story: Authorities mull lowering fiscal rule oil price to USD 50 from 2027

Answer:

We covered the deficit in our regular monthly reports on the budget execution (see our March and April articles). In a nutshell, the FinMin explains it by front-loading of payments, but higher spending also surely reflects higher war-related expenditures as military activity has intensified and now involves more Russian regions, as well as more active Ukrainian drone attacks, forcing Russia to spend more on security and damage repair. It was widely anticipated that the federal budget deficit would exceed the initial target set in the budget. The government tends to revise the budget law twice a year, so the RUB 3.8tn deficit target will almost certainly be revised upward. For example, in 2025, the initial deficit was projected at RUB 1.2tn, while the final figure reached RUB 5.6tn.

Regarding RUB strength, although there is no full consensus on its negative impact, the majority of government bodies agree and publicly state that a strong RUB is not beneficial for budget performance. FinMin's suspension of FX purchases earlier this year was intended to support RUB weakening. However, higher oil prices due to the Iran war have reduced the need to force a weaker currency. The CBR argues that a strong RUB helps contain inflation. It may also support Russia's war effort, as the country imports components and equipment, making a stronger currency helpful in controlling these costs. There is also a political argument as a strong currency makes Russia's economy look larger and resilient to war/sanctions in the eyes of the public, although it indeed hurts the budget, while the inflation associated with potential depreciation will be highly unpopular.

As for potential state measures, it has been very difficult to assess the drivers of RUB movements. Sanctions and the war have made Russia's external trade flows much less transparent and the link between CA dynamics and actual FX flows has become weak. In our view, the government could influence the exchange rate through an increase in FX purchases as a result of a change in the fiscal rule, but if they really want to achieve significant devaluation it would be more effective to pressure (maybe unofficially) the large state-owned banks and oil&gas companies to buy FX (reduce sale of export proceeds).

Question:

Is there forward-looking data for the stock of short-term USD debt/liabilities that will come to offset the BCRA's gross reserves number? Also, do you have data on how much debt the Treasury repaid in external debt YTD vs the pure USD interest they paid?

The question was asked in relation to the following story: BCRA's Werning says FX firepower recovered, reserve accumulation will go faster

Answer:

On the BCRA's liabilities that we count in the net FX reserve measurement, unfortunately we don't have clean forward-looking data provided by the central bank. However, according to the latest IMF staff report, in page numbered 80, or page 84 of the PDF file, there is a table showing that the BCRA faces USD 7.3bn in FX debt service in 2027. Of that amount, USD 5.2bn is tied to repos, which we are already subtracting because they expire in Jan-April 2027. Then there are USD 2.2bn in Bopreal bond payments. Since we don't have a calendar of Bopreal payments, we cannot really tell what share of those USD 2.2bn is already being subtracted from gross reserves.

In any case, this information seems consistent with recent comments from BCRA Vice President Vladimir Werning, who said the central bank's USD purchases should start to match closer with reserve accumulation moving forward. This will depend more on whether the Treasury buys FX from the BCRA for its own debt payments than on the BCRA's liabilities.

On the government's debt payments, the IMF's staff report covers external debt payments the pages numbered 58 and 59. For data on FX debt payments regardless of residency, we can give a ballpark estimate based on ex-ante information provided by the government on the payment calendar for each year, see the table below. For a more exact estimate, we would need to check the monthly PDF reports prepared by the congressional budget office, we can be found here.

Question:

Do you know there are any details on the oil price for the 2026/27 Budget or oil price hedging policy?

The question was asked in relation to the following story: Government getting closer to issuing USD 500mn Samurai bond - minister

Answer:

The draft document (available only in Arabic at the moment) discusses global economic conditions and commodity prices on Page 14 and 15. That is pages 18-19 of 196 in the PDF reader. As far as I can see, the ministry of finance cites the IMF forecasts from April, which assumes an oil price of USD 82 in 2026 and USD 76 in 2027.

FinMin Kouchouk told journalists in April that the oil price assumed in the 2026/27 Budget is USD 75/barrel, adding that the energy subsidy was raised to EGP 120bn (USD 2.2bn). He said that the oil price assumption reflects a more cautious outlook compared to previous estimates and added that energy subsidies were "calculated with built-in financial buffers to absorb potential volatility in global energy markets".

We haven't seen any reports on oil hedges contracts for 2026/27, but those are not always publicly available. In related development, Egypt announced in March that the contingency fund will be nearly doubled to EGP 263bn (or 4.6% of total spending), and that Egypt will increase the size of strategic reserves of foods and fuels.

Question:

Do you think Yashar closing the gap with Together raises the likelihood of a pre-election alliance between them?

Answer:

No, I do not think so. At least not at that stage. There is no poll suggesting that a united list between the two can bring gains. On the contrary, those pollsters that checked for a scenario of Together and Yashar running together proved that an alliance between the two will garner less seats than the combined number if each one runs separately. Moreover, the pollsters did not definitively confirm that if Yashar and Together unite, this would secure majority for the opposition parties to be able to unseat the current government.

The leaders of Together and Yashar, Naftali Bennett and Gadi Eisenkot, have been discussing to join forces even before the founding of Together but it appears that Eisenkot is not willing to do so or is hesitant at least. Thus, Bennett turned to his previous partner Yair Lapid (they had a rotating PM agreement in the previous government) but kept inviting Eisenkot to join. The uniting of Bennett and Lapid resulted in losses for Together, which is now polling at about 21-23 MKs while the Bennett's party and Lapid's Yesh Atid were projected to win as high as 31 MKs if running separately.

Lazar Research published in today's poll an interesting breakdown what are the current preferences of the voters of the two separate parties - Bennett's and Yesh Atid. Thus, 65% of the Yesh Atid voters moved to Together, 12% - to Yashar, 12% are now undecided, 9% - to other opposition parties, and 2% to coalition parties. A similar share of 67% of the Bennett's party voters moved to Together, 11% - to other opposition parties, 9% to Yashar, 7% became undecided, 6% to coalition parties. Yashar is rather a centrist party, similar to Yesh Atid, so it is likely that those who moved to Yashar after the establishment of the Together list are rather centrist voters and they might also leave Yashar if it unites with Bennett (used to be far-right but now has more moderate but still rightist views), I think. And this might at least partially explain why a united list might lose voters, as pollsters predict.

Another point to consider is that Together is proposing the second spot to Gadi Eisenkot while he is now the most preferred for PM among opposition figures. Eisenkot appears to have ambitions to replace Netanyahu and is not likely to make do with the second place after Bennett, like Lapid did in the previous government. Thus, I do not see incentives for Eisenkot to become more inclined to join Together for now.

The question was asked in relation to the following story: Yashar closing gap with Together, its leader beats Netanyahu in PM preference

Question:

What are your thoughts on ILS cuts priced for this year, what is the likelihood of emergency cuts, August cut ahead of elections. BOI directive was pointing to 50-75 cuts for the year 2026 but seems we are looking at 75-100 bps for 2026, what are your thoughts?

Answer:

I do not think that the Bank of Israel will resort to emergency cuts. It has very rarely made monetary policy moves in unscheduled meetings in the past, the last one being during the world financial crisis in 2008. It did not hold unscheduled sittings during the coronavirus crisis and during the war either.

As for the magnitude of the monetary easing, it would be still very data dependent, I think, even if the situation looks to have changed in the positive direction. This also applies to the August decision - I think that the BoI might cut if it finds economic conditions justify such decision, despite the forthcoming election. The latest BoI research department forecast from end-March assumed 1-2 rate cuts to 3.50-3.75% by March 2027 (the policy rate was at 4.00% at the time). Looking at current conditions, I think that the MPC might make 2-3 rate cuts by March next year if the inflation environment remains benign, meaning that the policy rate might fall to about 3.00% by March 2027. The MPC has warned about risks to the inflation and even if the energy price channel has eased its pressure and the shekel is also offsetting part of the inflationary impact, two other important factors remain at play, in my opinion. First, the fiscal policy would remain expansionary this year and expenses might further increase due to higher defence spending but also due to the elections. Second, labour market shortages still exist and are not likely to fully close in the near terms due to the necessity to maintain larger number of reservists due to the shortage of soldiers and the still lower number of foreign workers than the level before the war started in Oct 2023. The monetary easing should boost demand and the MPC will likely want to see how this plays out in relation to the closing of the supply-related shortages. Therefore, I do not personally think that rate-setters would embark on a more significant monetary easing of more than 75bps in the next one year. However, Yaron's latest statement do suggest that another rate cut might be expected in July if the inflation reading for May (due on Jun 15) does not surprise negatively, in my opinion.

The question was asked in relation to the following story: Links to reporting of BoI governor statement

Question:

Could you please share links to the reporting?

Answer:

Yaron's statement was covered by local economic outlets like Calcalist and Globes. There were also articles on the subject by Reuters and Bloomberg.

The question was asked in relation to the following story: Falling inflation expectations might result in faster, stronger easing-governor

Question:

Cannot seem to find a link, would be very highly appreciated if you could help me out.

The question was asked in relation to the following story: Cabinet adopts draft supplementary 2026 budget, revised down by XAF 863bn

Answer:

The draft supplementary budget isn't officially published but in the communique from last week's cabinet meeting (https://gabonmediatime.com/gabon-communique-final-du-conseil-des-ministres-du-22-mai-2026/), there is a section outlining the budget assumptions that is titled: - Projet de loi de finances rectificative (PLFR) 2026

Question:

Do authorities publish an calendar with the scheduled dates for the auctions of OMO, FGB and other instruments?

The question was asked in relation to the following story: CBN sells NGN 683.3bn one-year T-bills

Answer:

The FGN Bond calendar is only up to Q4 2025 for now. The DMO should have updated it here: https://www.dmo.gov.ng/fgn-bonds/bonds-issuance-calendar It usually takes place on the last Monday of each month.

The CBN doesn't publish any calendar online but some local newspapers speak of having copies of the NTB calendar. According to Nairametrics, the next Q2 auctions are scheduled for June 3 (NGN 700bn) and June 17 (NGN 450bn). There's no OMO calendar unfortunately.

Question:

May I please ask whether you know if the AFD disbursement counts as lowering the ''foreign loans'' needs estimate for FY27 in the budget? from NT (Government received Tranche 2 of a foreign loan of Euro 200 million (equivalent to R3 862 million), from The French Development Bank (AFD) for the implementation of the country's Just Energy Transition Investment Plan.)

The question was asked in relation to the following story: Gold and FX reserves decline modestly in April on government debt repayment

Answer:

If I understand your question correctly, you are interested whether the disbursement from the AFD in April was already factored in the foreign loans planned for 2026/27. I can confirm that this loan was included in the borrowing requirement indeed, so there will be no change in the foreign loans needs of the government relative to the plan. The total AFD loan was agreed at EUR 0.4bn, out which EUR 0.2bn was already disbursed in 2025/26. With the tranche in April the loan has been disbursed in full. This loan is part of USD 3.2bn that the government will raise from multilateral institutions in 2026/27 and part of USD 13.2bn it will raise over the medium term (USD 5bn in 2027/28 and USD 5bn in 2028/29). The table below is from the 2026 Budget Review.