Ukrainian Bonds Gain as Hryvnia Drops Amid Russia Troop Moves

Ukraine’s benchmark Eurobonds advanced for a fourth day and the hryvnia weakened as Russian President Vladimir Putin sent out conflicting signals on the nation’s military intentions.

The yield on Ukraine’s dollar notes due in April 2023 fell four basis points to 10.15 percent after dropping 52 basis points yesterday. The hryvnia weakened 0.3 percent to 11.6563 per dollar by 4:21 p.m. in Kiev. It has slumped 29 percent this year, the worst performance among more than 170 currencies tracked by Bloomberg.

Markets in Ukraine and across the region rallied yesterday as Putin said he’s pulled Russian troops from the border after weeks of tension. Today, he said Russia is testing its army’s combat readiness and NATO said it hasn’t seen any evidence of troop withdrawals.

“Putin’s views on Ukraine have certainly not changed,” Viktor Szabo, who helps manage more than $12 billion in emerging-market debt at Aberdeen Asset Management Plc, said in e-mailed comments today. “The market was looking for an excuse for a rally and it seems Putin’s comments came in handy.”

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