Dutch Budget 2023: Purchasing power reparation
The Dutch government presented its 2023 budget yesterday afternoon, on this year’s ‘Prinsjesdag’. The package is set to fuel the biggest increase in purchasing power in years. Contrary to other years, the budget was already outdated the night before by the introduction of a price cap on energy bills, the costs are estimated to be between EUR 10 – 15 bn. Which increases uncertainty on the budget forecasts.
The Dutch economy has outperformed the other big eurozone countries since the start of the pandemic
The budget balance for 2023, published in the Miljoenennota, is expected to land at -3.0%of GDP, compared to -0.9% of GDP in 2022
Today, the DSTA published its Q4 issuance outlook and once again reduced its borrowing requirement for 2022 by EUR 3.6bn to EUR 62.7bn in total
As such, we expect the DSTA to issue in the lower part of the range for the upcoming auctions and estimate around EUR 8bn left to be issued on the capital market this year
Based on the 2023 budget, we estimate the Dutch State’s borrowing requirement at around EUR 78.9bn for 2023, which is EUR 16.2bn above this year’s borrowing requirement
However, given the uncertainty around the total cost of certain measures, we expect the total funding need to lean more on money market funding for greater flexibility and expect a 50/50 mix between money and capital market funding for 2023
As such, we estimate around EUR 40bn to 45bn in DSL supply in 2023
The DSTA will give an estimate on the total funding need in 2023 on the 16th December
The full publication can be read here: