Fixed Income
Ukrainian sovereign Eurobonds ended mixed last week amid a sharp pickup in Kyiv political activity that saw the path cleared for a pre-term October parliamentary election when the Svoboda and UDAR parties made a tactical withdrawal from the ruling coalition. Somewhat more surprisingly, Prime Minister Arseniy Yatseniuk announced his resignation on Thursday, accusing Svoboda and UDAR of refusing to back key economic reform legislation needed to keep the country’s IMF loan program on track. Although it is unclear whether Yatseniuk’s resignation is a real statement of opposition or merely a political ploy ahead of the election, 36-year old former Vinnysia mayor Volodymyr Groysman has taken over as acting head of the Cabinet. Meanwhile, the Finance Ministry was active on the local market last week, placing 1-year USD 200mn domestic bonds at an 8.0% yield. We suppose that the raised funds were used to pay a USD 120mn coupon on the Ukraine-17 Eurobond.
