Fixed Income
Ukrainian sovereign Eurobonds enjoyed very strong gains last week, lifted by an overall rise in global risk appetite and a rally in emerging market bonds in particular, as investor concerns over US-China trade friction have faded in the new year. The yield on JP Morgan’s GBI-EM index hit its lowest level since May. The index, which aggregates EM government borrowing costs, saw its yield drop to 6.39% from 6.70% in mid-December and 6.87% in late August. Ukraine’s benchmark 10-year Eurobonds surged by 4.5% to close at 99.8/100.4 (9.8%/9.7%), and medium-term Ukraine-24s advanced by 4.2% to 93.1/94.1 (9.4%/9.1%). The VRI derivatives (linked to Ukraine’s future GDP growth with expiration in 2040) gained 3.1%at 59.1/60.1 cents on the dollar.
