Russia FX/Rates Snapshot - June 28, 2018
Yesterday marked the last auction of 2Q18. The ministry placed only R218 bln of the planned R450 bln on a gross basis. An unfavorable market backdrop (e.g. sanctions, EMs selling off, hawkish CBR rhetoric) has forced the ministry to cut issuance and even cancel some auctions. In 3Q18, we expect the ministry to try to borrow a gross R400 bln. Amid rising expectations of higher inflation, it will continue to place CPI linkers. It seems that demand for nominal OFZs from local banks rose significantly in 2Q18, so, absent shocks in global markets, even if foreign demand does not recover there is a good chance the ministry will try to borrow R400 bln without a significant rise in yield.
Sberbank CIB Investment Research is a research firm offering equity, fixed income, economics, and strategy research. It covers analysis on all aspects of Russia’s capital markets, issues and industries. The firm analyzes trends in Russia and combines local knowledge with a global perspective. It processes macroeconomic data, market and company-specific news, stock quotes and other information for providing research reports. The firm provides details and latest prices on the most traded names and most traded paper on all segments Russian market. In strategy research, it provides thematic research, tips and descriptions of the methodology used to evaluate companies.
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