Fixed Income

July 02, 2018

Ukrainian sovereign Eurobonds declined in value for the third week in a row, as investors seem to be becoming more concerned about next year’s elections in the country. According to the most resent surveys, if the parliamentary elections in Ukraine were held in mid-June, a very high number - eight - political parties would pass the 5% electoral barrier. The party rating is headed by populist Yulia Tymoshenko’s Batkivschyna Party, which is supported by 17% of those who chose a side and intend to vote. The second position belongs to the generally pro-Russian Opposition Bloc. The survey’s results highlight a risk that Ukrainian political landscape might change dramatically next year with no clear understanding about whether such changes would be positive for the country. In other internal news, there was a report that the deficit of the national budget amounted to UAH 9.2bn (USD 350mn) in 5M18, compared to a surplus of UAH 26.5bn for the corresponding period a year ago. The deficit in la