Ukrainian Credit Risk Declines to Month Low on Russia Aid Bets

Ukrainian credit risk dropped to the lowest level in a month and bond yields fell on speculation Russia will step in with financial aid for its western neighbor after the government took steps to repair economic ties.

Five-year credit default swaps, contracts insuring the Ukraine’s debt against default, declined 42 basis points to 926 by 6:28 p.m. in Kiev, the lowest on a closing basis since Oct. 24. The contracts jumped as high as 1,019 on Nov. 22 after Ukrainian President Viktor Yanukovych halted trade agreement talks with the European Union. The yield on the dollar bonds due in 2023 decreased 12 basis points to 9.55 percent today.