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This week, the Ministry of Finance will hold a swap auction to exchange reserve bonds, the third one since the beginning of the year. Last week, the MoF borrowed UAH19.6bn via sale of military, regular, reserve, and USD-denominated bonds. Reserve securities accounted for more than a quarter of total funds raised.
The lingering war and heightened safety risks imply Ukraine will remain critically dependent on foreign financial aid for its defense efforts and macroeconomic stability. A new IMF program would be of little help if not funded properly. Fortunately, the EU started serious discussions about an EUR140bn reparation loan for Ukraine linked to russian frozen assets. The Ukrainian authorities believe the loan approval is highly likely and only the timeline is uncertain. Should the loan be stamped, Ukraine will receive much-needed reassurance that its fiscal needs are fully covered even in a pessimis...
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