Bonds: Liquidity declines

Обзор облигаций 09.09.2014 Broader banking sector liquidity fell UAH2.53bn yesterday to UAH46.46bn as banks' correspondent accounts with the NBU fell UAH1.68bn to UAH29.66bn and total CDs outstanding declined UAH0.85bn to UAH12.38bn. Total local currency debt repayments scheduled for the next 30 days remained steady at UAH4.42bn. KyivPrime interest rates slightly rose: the KyivPrime ON interest rate rose 23bp to 8.33% while the KyivPrime 1M interest rate rose 57bp to 15.67%. Investment implications: Liquidity continued to decline yesterday as the NBU did not support liquidity and slightly decreased the volume of CDs outstanding. The main outflow most likely is FX to satisfy demand from last week that was postponed due to new regulations. At the same time, with no large injections from the NBU or MoF, the MoF was unable to make large budget expenditures or repayments.