OREANDA-NEWS. March 22, 2010. On 19 March 2010, the Cabinet of Ministers sold UAH 2.7bn worth of Ukraine sovereign bonds. Though the coupon rate was quite low (11% vs. over 20% of the previous placements), the amount of the placement was the largest in 2010. The bulk of the issue was bought by the state owned banks: Ukrgasbank, Rodovid bank and Bank Kyiv.

As Millennium Capital has expected, the government continues financing the State Budget Deficit, particularly the deficit of the Pension Fund, via increasing the State Debt. In accordance to Millennium Capital’s estimates, the State Budget deficit amounted to around 4bn per month in late 2009 - early 2010. Due to the fact that at the moment the issue of bonds is the principal source of financing the Budget Deficit, Millennium Capital anticipates their issue of at least UAH 30bn worth of government bonds in 2010, which may accelerate slightly the inflation rate.