Fixed Income

July 22, 2019

Ukrainian sovereign Eurobonds finished mostly higher last week, as the approaching parliamentary election appeared to be a well-understood phenomenon for investors. Polls predicted (accurately) that President Zelenskiy’s People’s Servant (SN) party would secure around 43% of the national party list votes, implying that the president could enjoy levels of political dominance rarely seen before in Ukraine. The actual result, which saw SN win around 250 seats, will allow Zelenskiy to form a government without the help of any junior coalition partners, and he can increase his majority even further by securing loyalty from the 50 independent MPs elected from geographic districts. Since becoming president, Zelenskiy has been warmly greeted by Ukraine’s western backers, after his reassurances that Kyiv would maintain an EU integration path.