Tags: Ukraine | bonds | IMF | aid

Ukraine Bonds Cap Weekly Gain Amid Talks for 2nd Part of IMF Aid

Friday, 11 July 2014 08:34 AM

Ukraine’s Eurobonds rose, sending the yield lower for a fifth day, on speculation the government will reach an agreement with the International Monetary Fund to qualify for the second tranche of a loan.

The yield on dollar-denominated notes due in 2017 fell eight basis points to 8.07 percent, bringing this week’s drop to 86 basis points. The hyrvnia weakened less than 0.1 percent to 11.6828 per dollar by 2:32 p.m. in Kiev, taking its loss this year to 30 percent.

The bonds have extended gains since Premier Arseniy Yatsenyuk said July 9 Ukraine has met the terms for the second part of the $17 billion aid package agreed to in May. The country, which has already received $3.2 billion of the rescue loan, has $19 billion in principal and interest payments coming due through the end of next year. The IMF extended its mission to Kiev until July 12, the Washington-based lender said in a statement yesterday.

The IMF program is “on track, and there is strong commitment from Ukrainian authorities to continue,” Vadim Khramov, a London-based analyst at Bank of America Corp., who earlier worked for the IMF, wrote in an e-mailed report today, calling the IMF talks “positive.”

The Ukrainian Equities Index fell 0.7 percent, reversing a gain of as much as 1.2 percent. Ukraine hit separatists near Donetsk with air strikes, saying it killed more than 50, as the European Union geared up to expand sanctions in response to the pro-Russian insurrection that’s rocked the country since March.

The equity measure has jumped 37 percent this year, the most among more than 100 gauges tracked by Bloomberg, after Argentina’s Merval. In dollar terms, it has slid 3.9 percent.

Investors expect the government will improve the nation’s regulatory environment, which bodes well for equities, Oleksiy Andriychenko, a Kiev-based analyst at ART Capital Group, said by phone today.

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Ukraine's Eurobonds rose, sending the yield lower for a fifth day, on speculation the government will reach an agreement with the International Monetary Fund to qualify for the second tranche of a loan.
Ukraine, bonds, IMF, aid
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2014-34-11
Friday, 11 July 2014 08:34 AM
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