Fixed Income
The Ukrainian sovereign yield curve moved lower last week after positive news that the European Commission decided to allocate an EUR 600mn aid tranche to Ukraine under the COVID-19 related macro-financial assistance program. The disbursement of this second tranche was conditional on fulfilling 8 specific measures in the areas of public finance management, the fight against corruption, improving the business environment, and the governance of state-owned enterprises. Although, in our view, the Zelenskiy administration and Parliament have been slow in the implementation of needed structural reforms, the EU decision is clearly beneficial for the country in getting additional support from Western partners, while confirming that Ukraine remains high on the European agenda.
