Fixed Income

January 11, 2021

The overall bullish sentiments on global financial markets helped to prop up quotes for Ukrainian sovereign Eurobonds last week. Investors are now counting on ramped-up fiscal stimulus in the US after the Democratic Party unexpectedly won control of the Senate on Jan 6 to go along with its White House victory. Currently, there is a broad opinion that in an environment of low- and even negative-yielding debt across the EU, the search for yield will intensify, with a focus on emerging market bonds, private debt, and physical assets. In Ukrainian internal developments, the country went into its pre-scheduled lockdown for 16 days starting on Jan 8. The COVID-19 quarantine measures this month will not be as strict as during the spring lockdown in 2020. We believe that the quarantine restrictions will not hit the economic recovery too heavily, having the most negative impact primarily on the restaurant and entertainment industries.