Research Briefing | Jan 20, 2022

Ukraine’s sovereign Eurobonds are a bargain despite risks

Ipad Frame - Ukraine-Sovereign-Eurobonds-are-a-bargain-despite-risks

Ukraine’s sovereign Eurobond yields soared since mid-November when US sources first reported a build-up of Russian troops along its eastern border. We retain an overweight on Ukraine’s Eurobonds. We think markets are pricing in too high a risk of invasion and default.

What you will learn:

  • We calculate that Ukraine’s benchmark bonds price in a 20% probability of default, but better outcomes for Ukraine are still on the table.
  • We believe that Russia aims to capitalise on the inconsistencies in the current US and NATO position on Ukraine’s NATO membership.
  •  If a military operation takes place, it is more likely to be in a form of precision strikes on key Ukrainian military infrastructure.
Back to Resource Hub

Related Resources

Indonesia parliament complex building

Post

Indonesia likely to miss fiscal target in 2023

We expect Indonesia's budget balance to show a large deficit in H2 of this year as the cost of fuel subsidies is finally reflected in the fiscal accounts.

Find Out More
Shipping port in Thailand, Asia

Post

Shifting Asian supply chains amid ongoing US-China frictions

Manufacturing hubs in South East Asia are set to benefit from firms hedging against ongoing US-China frictions, in our view, and ASEAN countries will continue to be attractive destinations for investment.

Find Out More