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JP Morgan GBI EM Index To Include Ukrainian Hryvnia Bonds

Government bonds of Ukraine claim to be included in the JP Morgan Global Index Research GBI-EM GD starting from March 31, 2022 with an approximate share of 0.12%. This is reported by the Ministry of Finance of Ukraine.

Initially, all three GBI-EM series will include one series of bonds that meets the requirements of the index: government bonds with a coupon of 15.84% maturing in February 2025.

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JP Morgan Global Index Research noted that the portfolio of foreign investments in Ukrainian government bonds issued in the domestic market has grown significantly since the launch of the link with Clearstream in 2019, and the share of non-residents in the government bonds market has grown to more than 10%.

Most investors acknowledged the improvement in market liquidity over the past two years, but at the same time noted that the process of opening an account in Ukraine may take several months. Inclusion in the index will begin on March 31, 2022, in order to provide investors with sufficient time, if necessary, to establish access to the market and accounts in Ukraine.

“We are grateful to the JP Morgan Index Team for the good news. The inclusion of hryvnia government bonds in the JP Morgan GBI EM index helps us achieve the objectives of our Medium Term Public Debt Management Strategy. We would like to have more hryvnia instruments suitable for the index, therefore we will issue all bonds in hryvnia with a maturity of more than four years, in an amount sufficient to be included in the JP Morgan GBI-EM index “, – said the government commissioner for public debt management Yuriy Butsa. Emerging Markets Index (GBI-EM) is used by investors to track the performance of developing country bonds for investment purposes. The most popular version of the GBI-EM Global Diversified Index covers 16 countries: Brazil, Chile, Colombia, Peru, China, Indonesia, Malaysia, Philippines, Thailand, Mexico, Nigeria, Poland, Romania, Russia, South Africa and Turkey.

  • In financing the state budget, the Ministry of Finance mainly focuses on the domestic market, reducing dependence on external borrowing. In the budget for this year, the Ministry of Finance has planned to borrow almost UAH 520 billion on the domestic market, but so far it has been able to attract only about half.