Fixed Income
Ukraine’s sovereign Eurobonds rebounded sharply last week on news of Russia’s commitment to invest a reported USD 15bn in Ukrainian bonds from its own sovereign wealth fund. It is expected that Ukraine will sell an initial issue of 2-year, 5% coupon bonds in a total amount of USD 3bn to Russia by the end of this year. The deal will help the country to secure the government’s external repayments, which are estimated at USD 5.6bn in 2014, including redemption of a USD 1.0bn Eurobond due in early April. Quotes for this issue jumped by 4.1% to 100.0/101.0 (7.9%/5.6%). Ukraine-23s, battered after a half year of declines, surged by 7.5%. to 90.2/91.7 (9.1%/8.8%), and medium term Ukraine-17s saw a similar advance of 7.0% to 92.0/93.5 (9.3%/8.8%).
