Ukraine's bonds soar after Trump's war talks amid his victory - Bloomberg

Ukraine's dollar bonds jumped as Donald Trump's promises to accelerate the end of the war with Russia came into focus after his re-election as US president, Bloomberg reports, UNN writes.

Details

As the publication points out, the country's GDP warrants, a kind of debt security with payments tied to economic growth, were trading above 73.6 cents to the dollar, the highest level since Russia's full-scale invasion in 2022, when the securities fell to less than 15 cents.

Fund managers have already been buying Ukraine's dollar-denominated bonds in recent weeks as a Trump presidency has begun to appear more likely. According to data compiled by Bloomberg, the bonds were among the best performers in emerging markets on Wednesday in terms of percentage gains as of 11:14 a.m. in London. Ukraine's 1.75% bonds due in 2035 were up 1.7 cents on the dollar to 47.2 cents.

"The bonds reflect the likelihood that the war could end sooner rather than focusing on what the deal will look like," said Tis Lowe, portfolio manager at Ninety One UK Ltd.

Gains from Ukrainian bonds stood out among emerging markets, where currencies and stocks were largely sold off on the prospect that Trump could impose punitive tariffs on trade. Eastern European currencies were the worst hit, with the forint trading at its lowest level since late 2022.

Addendum

According to the newspaper, in July, Putin said that Russia was taking seriously Trump's statements that he had proposals for a quick end to the war.

However, according to Ukrainian investment company Dragon Capital, it remained unclear what immediate leverage Trump would use against Russia to force it to stop the offensive. "Therefore, achieving a genuine ceasefire may prove to be a longer process than expected," the statement said.