Gov\'t bond auction preview; Credit Agricole; UAH touches a multi-year low

Broader banking sector declined UAH0.82bn to UAH28.15 yesterday because banks\' correspondent accounts with the NBU were down UAH0.77bn to UAH19.47bn and total NBU CDs outstanding fell UAH0.05bn to UAH2.51bn. Total debt repayments scheduled for the next 30 days remained steady at UAH6.17bn. KyivPrime interest rates slightly diverged yesterday: the KyivPrime ON rate declined 25bp to 2.00%, but the KyivPrime 1M interest rate rose 58bp to 8.00%.
Investment implications: Liquidity fell slightly yesterday, but not enough to prevent the rebound of banks\' correspondent accounts with the NBU to above 20.0bn. Broader banking sector liquidity should remain close to the yesterday\'s level amidst mild internal fund transfers. However, market sentiment is likely to be negative because of the rising KievPrime 1M rates and local currency bond yields.
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