Fixed Income

December 23, 2019
 

Ukraine’s sovereign Eurobonds were on the rise last week amid renewed risk appetite among international investors. Portfolio managers turned bullish on emerging-market bonds and currencies as the threat of a global recession recedes amid the decrease in US-China trade tensions. In Ukraine-related news flow, expectations that Kyiv and Moscow were close to reaching a natural gas transit deal gave additional support to the positive sentiments. The longest outstanding Ukrainian sovereign bonds with maturity in 2032 increased by 1.3% to 104.7/105.4 (6.8%/6.7%), and medium-term benchmark Ukraine-24s added 0.5% to 108.9/109.6 (6.6%/6.4%). The VRI derivatives (linked to Ukraine’s future GDP growth with expiration in 2040) were higher by 1.5% to close at 95.0/96.0 cents on the dollar.