Borrowings at two-year low
Yesterday, the primary auction set a two-year record to the downside for the amount of funds raised. Even during the first wave of the COVID-19 pandemic, the MOF was able to borrow more.
Previously, the lowest amounts raised in a primary auction were in January and October 2019.
Demand for all offered securities, both in local and hard currency, was insignificant, amounting to only UAH238m.
Bids for all UAH-denominated bills started from higher rates than where those instruments were sold earlier in January.
Demand for five-month paper was the largest and unanimous — UAH71m at face value and with rates at 11.5%.
This is 50bp more than a week before the NBU recent review of the key policy rate. So this demand was fully accepted. The minimum level of rates in bids for two-year bonds was 13% yesterday, which was only 5bp higher than two weeks ago.
RESEARCH TEAM
Vitaliy Vavryshchuk, Alexander Martynenko, Taras Kotovych.
The full report can be found here.
