Finance Ministry cuts rates on govt domestic loan bonds in hryvnia by 0.2-0.3 p.p., in U.S. dollars by 0.5 p.p.
The Finance Ministry of Ukraine at its primary auctions on July 16 for the fourth week in a row managed to lower the cut-off rate: for three-month hryvnia-denominated securities from 17.24% to 17%, for six months from 17.6% to 17.4%, for 12 months from 18% to 17.74%, and for two-year bonds from 17.95% to 17.75% per annum.
According to the results of the auctions on the website of the ministry, to reduce the rates on securities up to one year inclusive, the ministry sacrificed the demand of UAH 2.62 billion, limiting the supply of three- and six-month securities to UAH 500 million, for 12-month securities to UAH 1 billion.
The demand for three-month government domestic loan bonds reached UAH 1.27 billion, six-month securities UAH 1.012 billion, and 12-month bonds some UAH 2.32 billion. As a result, on the eve of the reduction of the refinancing rate by the National Bank from the current 17.5% per annum expected by the market participants, the seller managed to lower the average weighted placement rates: for three-month securities from 17.24% to 16.96%, for six-month securities from 17.47% to 17.21%, and for 12-month bonds from 17.99% to 17.68% per annum.