Rates Weekly - November 17, 2020

> Ruble liquidity: Overnight rates return to normal levels as new reserves averaging period starts. Last Wednesday, a new reserves averaging period started. Since then, banks have shown more demand for liquidity, and the O/N FX swap rate rebounded from depressed levels around 3.00% to about 3.80-3.90%. The RUONIA rate also rose moderately over the last week, to about 4.15%, below the 4.20-4.25% where it traded during most of the previous reserves averaging period, amid high OFZ placements. Over the next week, we see quite a decent liquidity surplus of about R0.5 trln remaining. In addition, we do not see a significant liquidity outflow related to the OFZ auctions, as the Finance Ministry will not offer floaters tomorrow. Thus, we would expect the RUONIA rate to stay around 4.15% through the weekend. However, early next week, despite the remaining liquidity surplus, the rate could climb to 4.20% amid the expected R0.6 trln in taxes due, half of which is MET.> OFZs and rates: Finance Ministry will not place floaters at tomorrow's auctions. Tomorrow, the Finance Ministry will offer the 10y OFZ 26235 (March 2031) with no limit (R250 bln remains), R30 bln of the 5y nominal OFZ 26234 (July 2025) and R20 bln of the 10y CPI-linked OFZ 52003 (July 2030). We think that around R40-60 bln will be placed in total. The absence of a floater on offer likely means that the ministry has mostly fulfilled its internal plan for this year.