Rates Weekly - November 9, 2021. Auctions to Resume Tomorrow

> Ruble liquidity: O/N rates to remain stable at the beginning of new reserves averaging period. Tomorrow, after settlement of the CBR operations, there should be a liquidity inflow of R1.2 trln. Accordingly, tomorrow the current accounts of banks at the CBR will climb to about R4.0-4.1 trln, which will be about R0.9 trln above the required level. This is quite significant, but banks' demand for liquidity will be also high, as usually occurs at the beginning of the reserves averaging period as banks try to over-average ahead of tax payments later the month. As a result, O/N rates could fall, albeit likely only slightly and still remaining stable at around 7.4% over the next five working days.> OFZs and rates: Auctions to resume tomorrow. For the first time in the last three weeks, fixed-coupon issues will be offered: the 10y OFZ 26239 (July 2031), subject to an offer limit of R20 bln, and the 15y OFZ 26240 (July 2036), also limited to R20 bln. We see this lineup as relatively light for the market to digest, given the long absence of supply and much lighter positions of both dealers and internationals (who withdrew R130 bln from OFZs after the CBR meeting). As a positive factor for the market, we would mention that the Finance Ministry could have refrained from setting offer limits, but probably decided to enhance the scope for the market recovery.