Liquidity hits new record high

Обзор облигаций 23.07.2015 The broader liquidity indicator rose UAH1.70bn yesterday to UAH77.95bn, setting a new record high since 2011. While banks' correspondent accounts with the NBU slid just UAH0.05bn to UAH26.15bn, the NBU increased total CDs outstanding by UAH1.74bn to UAH45.24bn on Tuesday, causing a significant increase in the broader indicator. Total local currency debt repayments scheduled for the next 30 days remained steady at 6.56bn. Despite the increase in liquidity, KyivPrime interest rates remained steady, most likely due to negative anticipations of month-end tax payment. Investment implications: Despite the NBU decreasing interest rates on CDs last week, banks continued to purchase this instrument for short-term investments. The MoF was scheduled to repay UAH0.86bn yesterday, but no more than UAH0.30bn will be received by banks or other investors. As month-end tax payments will most likely be postponed for the next week, liquidity could continue to increase through the end of this week.