How the Government of Canada Borrows Money

The main instruments

Treasury bills are short-term securities sold at a discount and repaid at face value. Marketable bonds generally have longer maturities and pay interest. The debt program uses multiple terms to spread refinancing over time.

The government also manages foreign-currency borrowing for official reserves and may use specialized instruments under published frameworks.

Auctions and the fiscal agent

The Bank of Canada conducts securities auctions and cash-management operations on behalf of the federal government. Dealers submit bids under published terms, and auction results are made public.

This fiscal-agent role is operational. Monetary policy decisions are made under the Bank’s separate mandate.

Why borrowing can exceed the deficit

Maturing bonds must often be refinanced with new issues. The government may also need cash for loans, investments, foreign-exchange reserves or changes in accounts payable and receivable.

Gross issuance therefore includes both new financing and replacement of maturing securities. It should not be described as an equal addition to accumulated debt.