Russian Finance Ministry sees improved conditions on federal bond market, will choose instruments based on demand - deputy minister
MOSCOW. Nov 19 (Interfax) - The Finance Ministry can see an improvement in the conditions on the Russian federal loan bond (OFZ) market and intends to respond flexibly to market demands for various instruments while carrying out the borrowing plan for Q4, Deputy Finance Minister Vladimir Kolychev told reporters.
"We will monitor the market conditions. Overall, based on recent placements, we can see that market conditions are improving and stabilizing; yields have stopped rising and have even declined. We placed a fairly significant amount last week compared to previous weeks," he said.
When asked about the instruments the Finance Ministry will focus on the remainder of the year, Kolychev said that this will depend on demand. "Recently, fixed bonds have been in demand. If the situation changes, we will respond flexibly to requests," he said.
Kolychev said previously that the ministry is still adhering to its borrowing plan for the domestic market in Q4. As of October it has been completed less than 5%, and there are signs of stabilization, after which the ministry will to go to the market as planned, he said.
The ministry expects the federal budget deficit for 2024 to be within 1.7% of GDP. Kolychev confirmed this forecast on Tuesday.
To meet the quarterly borrowing plan of 2.4 trillion rubles, the ministry has to place OFZ bonds worth more than 2 trillion rubles in the remaining six auction days of the year. In October, 113 billion rubles of OFZ bonds were placed at auctions. The placed amount was around 94 billion rubles in the November auctions. The main amount was raised on November 13 with the placement of two OFZ-PD issues. However, the auction on November 6 for floating-rate bonds was declared unsuccessful due to a lack of bids at acceptable price levels.
In the upcoming auction on November 20, the ministry plans to conduct only one auction, for the OFZ-PD series 26247.
