Fixed Income
Ukraine’s sovereign Eurobonds remained on the rise last week following the country’s placement of EUR 1.25bn in new 10-year Eurobonds at a record-low price of 4.375%. The new issue is expected to be rated B by Standard & Poor’s and B by Fitch. The achieved yield was notably lower than the initial guidance of 5.0% per annum amid favorable risk appetite from investors. In June 2019, Ukraine offered a 6.75% yield when issuing a 7-year EUR 1.0bn Eurobond. Now these papers are quoted at 113.3/114.0 (4.3%/4.2%) on the market. The longest outstanding Ukrainian sovereign bonds with maturity in 2032 advanced by 1.0% to 110.2/111.0 (6.1%/6.0%), and medium-term benchmark Ukraine-24s edged higher by 0.3% to 111.1/111.8 (5.9%/5.7%). The VRI derivatives (linked to Ukraine’s future GDP growth with expiration in 2040) climbed 0.5% to close at 100.0/101.0 cents on the dollar.
