Fixed Income

February 08, 2021

Ukrainian sovereign Eurobonds enjoyed further appreciation last week as the hunt for yields continued in a low-rate environment, with the US 10-year Treasury note currently offering investors only around 1.15%. Moreover, the inflation-adjusted benchmark treasury yield is now negative at -1.02%, pushing capital toward emerging market bonds. The rise in flows to emerging markets has been mirrored in outperformance for those markets versus the developed world. In Ukrainian politics, President Zelenskiy banned a trio of television networks that he said spread Kremlin-funded propaganda in support of the increasingly popular pro-Russian Opposition Bloc party. Although the sudden shutdown of the networks without a court ruling is another indication of Zelenskiy’s political inconsistency, the decision also feels like the right move in the ongoing battle against Russian disinformation.