Liquidity reallocation

Обзор облигаций 27.07.2015 Broader banking sector liquidity rose UAH0.84bn to UAH77.75bn as total CDs outstanding fell UAH1.22bn to UAH47.58bn and banks' correspondent accounts with the NBU increased UAH2.06bn to UAH24.25bn last Friday. Total local currency debt repayments scheduled for the next 30 days remained steady at UAH5.91bn. KyivPrime interest rates remained steady at 19% and 24% for ON and 1M funds, respectively. Investment implications: lthough liquidity remains high, interest rates also stay high in anticipation of a liquidity decline and cost of funds increase. As interest rates for local currency bonds remains above 20%, the anticipation of month-end tax and other payments scheduled this week are pushing short-term interest rates possibly higher.