The government will now borrow an extra $50 billion in the June 2021 fiscal year to mitigate the hit from the covid-19 pandemic.

The impact of covid-19 on the Crown's fiscal outlook is "unprecedented" and requires a substantial increase to the forecast borrowing programme relative to the forecast at the Half Year Economic and Fiscal Upbeat 2019," the New Zealand Debt Management Office said.

The forecast 2020-21 bond programme is now set at $60 billion versus $10 billion forecast in the December HYEFU.

In the following year, the bond programme has been revised higher to $40 billion, followed by $35 billion in the June 2023 year and $30 billion in June 2024.

The December HYEFU forecasts were for $8 billion in the June 2022 and 2023 years and $6 billion in 2024.

By the end of the forecast period, gross New Zealand government bond issuance will be $190 billion, the DMO said.

Taking into account maturities and repurchases, net issuance will be $142.4 billion.

Treasury bills on issue are forecast to be $10 billion across the forecast period.

Meanwhile, subject to market conditions it expects to launch a new nominal bond via syndication between June 30 and Sept. 30. The maturity will be confirmed ahead of syndication.

A syndicated tap of an existing bond is also expected to take place this time.

Finally, issuance into inflation-indexed bonds is expected to be between $1 billion and $2 billion in 2021, subject to market conditions.