Moscow may go to market to plug budget gap as Russian bonds rebound

International interest in Russian bonds continued to grow this week with yesterday’s issue from Gazprom Neft yielding 9.4%, the lowest of any body  issued by a  major Russian company in the past two and half years. The yield – down from a recent average of 11% – reflects a range  of recent macroeconomic indicators that suggest that the worst of Russia’s economic recession may be over. In Q2,  economic contraction fell to  0.6%, while July saw the first bout of deflation in five years and the country’s hard currency reserves have remained stable at just under $390bn, despite widespread predictions that Russia would run out of money following the collapse of oil prices at the end of 2014.
 In June, the World Bank slightly improved its economic outlook for Russia, saying that while the country’s  GDP was expected to contract by 1.2% this year it should grow by 1.4% in 2017.
“The Russian economy is going through a difficult period of adjustment. At the same time there are signs that some sectors may have bottomed out,” Director of the World Bank Group’s Development Prospects Group Ayhan Kose told the TASS news agency at the time.  While pressure   from Washington has meant that international investors  have been staying clear of the Russian markets, Moscow may now seek to raise up to a further $3bn to help plug this year’s projected budget deficit.

Source: intellinews