Liquidity declines despite inflows

Обзор облигаций 29.05.2015 Banks' correspondent accounts with the NBU remained steady at UAH21.03bn yesterday, as the NBU received about UAH1.7bn of inflows. Total CDs outstanding fell UAH0.80bn to UAH31.64bn and total local currency debt repayments scheduled for the next 30 days declined UAH0.76bn to UAH4.36bn. In addition, the NBU issued UAH0.16bn of additional loans on Wednesday. As a result, the broader liquidity indicator declined UAH1.56bn to UAH57.03bn. Investment implications: Liquidity continued its decline under the pressure of month-end tax payments and should continue to fall further today. After today's outflows, liquidity should decline below UAH55.0bn in indicators on Tuesday (the next business day in Ukraine). The NBU could issue additional ON loans for banks and decrease CDs outstanding today yet again.