Fixed Income

March 22, 2021

Ukrainian sovereign Eurobonds finished mixed last week, as the third wave of COVID-19 epidemic has not yet been priced into the country’s risk profile. The government is introducing a “red” level of epidemic danger in Kyiv and Odessa provinces, and the pace of the vaccination campaign is low in the country. Official statistics say that only 104,000 people have been vaccinated. Ukraine has supply agreements with six global manufacturers of vaccines, including AstraZeneca, Pfizer-BioNTech and Sinovac, and the vaccination pace should ramp up in April and May. Meanwhile, Standard & Poor’s has affirmed Ukraine’s “B” long-term credit rating. S&P notes that Ukraine’s economic growth, balance of payments, and public finance standing in 2020 exceeded analysts’ expectations. The volume of international reserves increased, securing protection against potentially adverse external factors. S&P analysts forecast Ukraine’s GDP growth at 4% in 2021.