The Ministry of Finance of Ukraine, during its sixth auction for the placement of domestic government bonds (OVGZ) in 2025 on Tuesday, maintained the cutoff rates for bonds maturing in June 2026 and June 2027 at 15.85% and 16.95% per annum, respectively, rejecting 43% of the demand.
According to data from the Ministry of Finance’s website, with an offering of 5 billion UAH (hereinafter at par value) at each auction, the demand for these OVGZ was again lower, decreasing nearly threefold compared to the previous Tuesday - to 621.4 million UAH and 552.6 million UAH, respectively.
The Ministry of Finance declined to satisfy 2 out of 19 bids for the June 2026 bonds at rates up to 16.2% and 3 out of 24 bids for the June 2027 bonds at rates up to 17.2%, while sales volumes fell to 375.5 million UAH and 301.9 million UAH from 1.39 billion UAH and 1.14 billion UAH a week ago, respectively.
The weighted average yield on the June 2026 OVGZ increased by 0.07 percentage points to 15.84%, whereas the June 2027 OVGZ rose by 0.1 percentage points to 16.9% per annum.
Additionally, the Ministry of Finance unexpectedly put a new bond issue maturing in January 2027 up for auction. With an offering of 5 billion UAH, demand amounted to 458.5 million UAH, and the Ministry was able to attract an additional 342.7 million UAH, setting a cutoff rate of 16.65% and rejecting 2 out of 8 bids at rates up to 16.7% per annum.
As for the announced first auction this year for the sale of annual OVGZ in euros, the Ministry of Finance canceled its conduct and rescheduled it for March 18.
As reported, the law on the state budget for 2025 provides for the placement of OVGZ amounting to 579.22 billion UAH, with a repayment volume of 561.98 billion UAH. At the same time, it is planned to attract $39.3 billion in external financing and cover it with a deficit of 1 trillion 875.87 billion UAH in the state budget.
A record was achieved in 2024 for attracting funds in the OVGZ market - 638.4 billion UAH, which exceeded repayments by 255.6 billion UAH.