Investors shifted to FX-denominated bills, which brought the budget more than half of the funds raised.

The shortest military bonds saw the most significant demand among hryvnia bonds, reported ICU. The MoF has not offered USD-denominated bills since April, so accumulated demand was evident in yesterday’s auction. This week’s redemption may be reinvested in new securities at the next auction or on the secondary market.

The total amount of bids for USD-denominated securities was $217M, but seven of them for more than $5M have required an increase in rates. The MoF disagreed and left the cut-off and weighted average rates unchanged at 4.25% and 4.17%, respectively. The budget received most of the hryvnia funds from 14-month military bills without material changes in rates.

The Ministry is finishing placing this issue and will most likely offer new bonds with a longer maturity next week, although it is unlikely that they will have a different rate level. The rates on longer, regular, UAH-denominated bonds have not changed either.

However, the demand for these bonds was relatively small: ₴659M for 20-month securities and almost ₴1B for three-year securities. Investors are now interested in FX-denominated securities, which are in a deficit in the bond market, and the Ministry of Finance seeks to reduce its outstanding gradually.