Economics
Canada Eyes Longer-Term Debt to Sustain Borrowing Binge
- Shift from short-term market would avoid ‘supply indigestion’
- Idea raises concern about ‘crowding out’ scenario: CIBC
Bill Morneau.
Photographer: David Kawai/BloombergThis article is for subscribers only.
The Canadian government is considering a shift to longer-term borrowing to finance its ballooning budget deficit, a strategy that has the potential to complicate matters for companies raising money in the country’s bond markets.
The government’s emergency spending program to counteract the coronavirus pandemic has mostly been funded with shorter-term debt, a situation that carries elevated risk when the time comes to refinance.