REUTERS
The National Bank says hryvnia strengthened by 0.3% against the U.S. dollar.
The national and state-guaranteed debt of Ukraine in May in national currency equivalent grew by 0.59%, to UAH 2.209 trillion, and by 0.83% in foreign currency, to US$82.12 billion.
According to the Ukrainian Finance Ministry, the fluctuations in the foreign exchange market in May remained minimal, therefore their impact on the national debt was insignificant. According to the National Bank of Ukraine (NBU), hryvnia strengthened by 0.3% against the U.S. dollar.
"Investor activity in the domestic capital market is recovering. In May, the Finance Ministry successfully held all of the four planned auctions placing government bonds, having raised UAH 51.6 billion (US$1.9 bilion). Following May auctions, a record amount of financial resources was raised in the national currency, namely UAH 41.8 billion (US$1.5 billion)," the report says.
The ministry said, amid growing demand and stabilizing economic conditions, the average weighted yield on government bonds decreased, including for three-month bonds, from 11.26% in early May to 10.19% at month-end. The reduction in rates for six-month government bonds amounted to 95 basis points, to 10.33% per annum.
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In the reporting period, investors were only once offered bonds denominated in foreign currency. At the auction on May 19, US$368.8 million (the equivalent of UAH 9.8 billion) was raised on six-month bonds.
In May, the ministry redeemed the second issue of external government loan bonds under the U.S. guarantee. The total amounted to over US$1 billion.
"Thanks to the 2017 re-profiling of government bonds in the portfolio of the National Bank for government bonds linked to inflation, the Finance Ministry significantly saves on servicing these government bonds. Thus, the coupon rate on bonds held in the NBU portfolio worth UAH 145.2 billion(US$5.4 billion) amounted to 4.5% per annum in the reporting period, compared with the rate of 12.6% before re-profiling," reads the report.
Over the reporting period, payments on public debt amounted to UAH 43.2 billion (US$1.6 billion), while UAH 12.7 billion (US$476.5 million) went for servicing.