RTTNews - Thursday, the Swedish National Debt Office said in a report that it will further increase exposure in foreign currency with the aim of reducing the costs of central government debt.

The government decided to increase the mandate for strategic krona positions by SEK 35 billion to SEK 50 billion from the current SEK 15 billion. This position will be built up gradually until 1 November 2009, the report showed.

We can reduce the cost of central government debt by increasing foreign currency exposure when the krona is weak and decreasing it again when the krona is strong, the report said.

The decision to increase exposure does not affect the volume of the foreign currency borrowing. The position can be built up with currency forward contracts or by loans already taken in foreign currencies being changed to kronor, the Debt Office said. The office added that the estimated borrowing for this year in foreign currency, a total of SEK 180 billion, is thus unaffected.

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