Fixed Income
Trading in Ukrainian sovereigns was muted last week despite the release of some rather encouraging macroeconomic statistics. In particular, UkrStat reported that retail sales rose by 3.1% YoY in 1Q17, a jump of 8.7% YoY in March alone. Finance Minister Oleksandr Danyliuk, who met with IMF management in Washington, reiterated the governement’s intention to issue new Eurobonds this year, saying he expects a placement in September or October. The volume of the issue would be modest, Danyliuk said. We assume the new placement will be for around USD 1bn. Ukraine has been locked out of the international Eurobond market since mid-2013, with the most recent issue occurring when Victor Yanukovich was president. Ukraine-27s, the country’s longest outstanding Eurobond issue, were unchanged for a second week in a row at 91.8/92.4 (9.0%/8.9%). The shortest sovereign, Ukraine-19s, also remained at their previous levels of 101.5/101.9 (7.0%/6.9%). The generally more volatile VRI derivatives (l
