Yesterday, the Ministry of Finance increased borrowings and without repayments that had to be refinanced. The most in demand were securities with maturities from one to two years, which brought the budget a total of UAH7.4bn out of UAH8.1bn of borrowings in local currency.
Demand for 12-month bills reached almost UAH3bn, but due to the cap, only UAH2.1bn was accepted. For the 1.5-year paper, demand was less than the cap and brought the budget only UAH1.7bn. Demand was greatest for the two-year instrument, UAH3.6bn, which brought the budget UAH3.7bn of proceeds.
The lowest demand was for five-year bonds, only UAH37m in seven bids, which may indicate that foreigners are currently not interested in them.
Another US$65m was raised in 12-month USD-denominated bills, which was almost half of what was raised three weeks ago. However, it was enough to support a fairly good amount of refinancing of foreign currency denominated domestic bonds.
In general, it seems that banks and other resident investors have increased interest in new government bonds since the hryvnia exchange rate stabilized. Foreigners, however, are still on pause.
Nevertheless, attracting a total of UAH9.9bn improved current financing for the budget, as the next repayment of UAH-denominated debt is scheduled for next week, and in hard currency in only two weeks. Therefore, it is still possible to accumulate funds for these payments.
