Eurobonds rates increased

April 22, 2016 18:05

The escalation between Belarus and the EU resulted in undesirable financial results. Belarusian Eurobonds quotes went down. The yield on five-year Eurobonds increased from 10.08% to 10.74% per annum (on 1st March), on 7-year bonds – from 10.29% to 10.61% per annum (on 1st March).

The yield on bonds is considered a benchmark for the placement of new bonds. In other words, if today Belarus decides to place bonds in the European bond market foreign investors will agree to provide funds at 10.7% per annum. For instance, a week ago, before the escalation of the diplomatic conflict, funds could be attracted at 10.1% per annum. When a country borrows hundreds of millions or even billions of dollars, even hundredths of a percent plays a big role.

Another important consequence is that due to the escalation a positive trend for Belarusian bonds has been interrupted, deteriorating chances to attract new funding.

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