Fixed Income

May 21, 2018

Ukrainian sovereign Eurobonds finished mixed last week after the US 10-year Treasuries yield broke back above the 3.0% level. Some better-than-expected US economic data pushed the 10-year Treasury to a seven-year peak of 3.06% last week, increasing the expectations of a Federal Reserve interest rate hike. In Ukrainian-related developments, German Chancellor Merkel met with Russian President Putin in the Black Sea resort of Sochi on May 18 to discuss the conflicts in Syria and Ukraine just days after Putin had opened a new bridge link from mainland Russia to the disputed province of Crimea. Ukraine’s National Security & Defense Council (RNBO) approved Crimea-related sanctions that mirror those of the United States, which has blacklisted several of Putin’s oligarch allies. Kyiv called on Ukrainian companies to seek compensation in Western courts from Russian companies and entities involved in the annexation of Crimea in 2014.