The Ministry of Finance maintained the level of refinancing of debt repayments above 100% in all currencies thanks to significant borrowings in hard currency yesterday.
Almost half of the funds came to the state budget from USD-denominated bills. The Ministry sold two bills maturing in October and December this year.
Bids for the new semi-annual paper were submitted at 4.75%, similar to the end of March, with the weighted-average rate was up by 16bp to 4.75%.
At the same time, for eight-month USD-denominated bills, the MoF did not agree to increase rates by 50bp, accepted only bids with rates at 4.8%, and rejected one for US$5.7m at 4.85%.
UAH bills were again in great demand, although slightly less than last week. Demand generally amounted to UAH8.8bn, which was UAH2.5bn less than last Tuesday. Yesterday, demand was distributed more evenly between securities and with only a small attempt to increase the interest rate.
Demand for military government bills maturing in March and June 2024 increased by UAH0.6bn to UAH5.1bn. It could be mainly from residents and brokers for their clients because there were 55 bids and an attempt was made to get a rate increase for the 11-month paper by 50bp up to 19%.
For ordinary bonds, demand tripled to UAH1.5bn, and there were only five bids, so considering that the coupon payment is already next week, it could also be demand from foreign investors.
Demand decreased only for "reserve" bonds, which the Ministry of Finance placed for only UAH2.2bn or approximately two-thirds of the offering.
Thus, on the eve of the redemption of USD-denominated bills for US$270m on Thursday, the Ministry of Finance attracted US$225m yesterday, which in general, made it possible to keep the refinancing level above 100% in USD terms. Also, the level of refinancing of UAH repayments is 145% YTD, slightly down from 1Q23.
