Cost of insuring Russia, Ukraine debt hits record high

11:29, 23 October 2008
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As cash-strapped investors pulled out of emerging assets

The cost of insuring the debt of emerging market sovereigns against restructuring or default hit record levels on Thursday, as cash-strapped investors pulled out of emerging assets and fretted about growth prospects in emerging economies, Reuters reported.

Russia`s five-year credit default swaps widened by 50 basis points to 1,050 mid-price, Commerzbank said. A CDS level above 1,000 represents distressed debt, analysts say.

Ukraine`s five-year CDS widened by around 200 bps to 2,800 bps.

Unicredit said Ukraine`s CDS were implying an 80 percent probability that Ukraine would default.

Kazakhstan`s CDS widened by around 100 basis points to 1,300 bps, and the CDS for European Union member Hungary, which hiked interest rates by three percentage points on Wednesday, widened by 30 bps to 575.


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