Fixed Income

May 13, 2019

Ukrainian sovereign Eurobonds ended lower last week amid ongoing concerns about when the country will actually receive a USD 1.3bn loan installment from the IMF previously expected by the end of May. The Washington-based fund said it intends send its monitoring mission to Kyiv within the next two weeks. Ukraine continues to have significant external financing needs and requires stable access to foreign funding, as the country needs to redeem USD 1.6bn in foreign currency debt by the end of this month. Total debt servicing and repayments for 2019 are estimated at USD 5.1bn. The longest outstanding sovereigns, Ukraine-32s declined by 1.0% last week to close at 87.5/88.5 (9.1%/9.0%), while medium-term Ukraine-24s were 0.4% lower at 94.1/95.1 (9.4%/9.1%). The VRI derivatives (linked to Ukraine’s future GDP growth with expiration in 2040) edged down by 0.3% to 63.8/64.8 cents on the dollar.