Page 81 - RUSRptOct18

in prices was in January 2016 when the oil price was $27 per barrel. In August the ruble fell 4.05% -- a record since December 2014. Long-term dated OFZs have depreciated by 12% since April, and the price of the 9-year bonds have risen from a coupon of 7% per annum in April, to between 9.1% and 9.2% now. Ministry of Finance cancelled auctions in the last week because of the volatility on the market. Non-resident investors are disposing of their Russian government bonds and exchanging their rubles for other currencies, driving the ruble to a new lows. On September 7 the ruble dropped to RUB69.95 to the dollar -- a record low since March 2016. The Euro passed the RUB80 mark, and was only 12 kopeks shy of breaching the RUB81 to the dollar mark. The OFZ have been popular with western investment funds in the last few years as they offered an attractive mix of high yields backed by Russia’s large hard currency reserves. But now they are not waiting for new sanctions to be imposed and dumping OFZs to be on the safe side. The proportion of foreign investors has dropped to 26-27%, a low since December 2016, although it had reached 34% in April, the Russian Finance Ministry reports. Over the last five months, non-residents have disposed of a record RUB600bn worth of bonds.
81 RUSSIA Country Report October 2018 www.intellinews.com