Bloomberg News

Ruble Bond Auction Falls Short as 2018 Note Raises 38% of Target

April 03, 2013

Russia sold 38 percent of a five- year bond offering as a slump in crude oil weakened the ruble.

The Finance Ministry issued 7.65 billion rubles ($242 million) of the 20 billion rubles of securities due January 2018 offered at a 6.33 percent yield, according to a statement on its website. The government placed all 10 billion rubles of bonds due January 2023 at 7.12 percent.

The ruble dropped amid a second-day retreat in the price of oil, Russia’s biggest export earner. Capital outflows climbed to a net $25.8 billion in the first quarter, according to the central bank’s preliminary estimates published today.

The “fragile global environment” and weakening ruble caused the auction demand to falling short, Dmitry Polevoy, an economist at ING Groep NV’s unit in Moscow, said by e-mail.

The government plans to offer 300 billion rubles of debt this quarter with maturities ranging from three to 15 years, the Finance Ministry said on March 29. The country sold 187.9 billion rubles of OFZs in the first quarter, according to ministry data.

The sale of the longer-dated debt was successful as the Finance Ministry offered a premium, Olga Sterina, an analyst at Moscow-based UralSib Financial Corp., said by e-mail. The ministry set guidance yesterday of 7.08 percent to 7.13 percent, compared with trading at 7.10 percent at yesterday’s close.

There are no “mega drivers” at the moment for Russia’s government bonds, Yulia Safarbakova, an analyst at BCS Financial Group in Moscow, said by e-mail. “The market’s not the strongest.”

To contact the reporter on this story: Mark Sweetman in Moscow at msweetman@bloomberg.net

To contact the editor responsible for this story: Mark Sweetman at msweetman@bloomberg.net


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