Fixed Income

October 09, 2017

Ukrainian sovereign Eurobonds bounced back last week after a period of correction/retreat throughout the second half of September. Parliament finally approved a long-awaited pension overhaul aimed at reducing the country’s overall number of retirees, a move which should take substantial pressure off the national budget in the medium and long terms. Although the bill is not in perfect compliance with the IMF’s prescription, it is nonetheless a signal that badly needed systemic reforms for the country are gradually being implemented. In a separate pleasant announcement, it was report that Ukraine increased its natural gas production by 3.6% YoY to 15.5bn cubic meters in January-September (the domestic sector is dominated by state-owned gas extractor UkrGazVydobuvannya to the tune of around 75%). This provide some optimism that the country is on a course to strengthening its energy independence.