The 10-year Russian OFZ yield was above the 9.1% mark, bouncing off the six-month low of 8.7% hit in late June amid a broad depreciation of Russian assets. Confidence in Russia’s economy and business climate took a hit after state-backed giant Gazprom canceled its 2021 dividend payments despite record-breaking earnings in 2021, strengthening expectations that state revenues from natural gas may sharply decrease as Russia cuts off supply to Europe. Meanwhile, investors further digested Russia’s default on its sovereign debt, as Western institutions blocked interest payments to foreign holders of a dollar denominated Eurobond. While its impact on the OFZ market is limited in the short term, technical defaults are expected to significantly affect Russia’s access to credit and its cost in the future. On the monetary policy front, the CBR is expected to further cut its benchmark interest rate as consumer prices decelerate and the ruble remains strong.
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Historically, the Russia Government Bond 10Y reached an all time high of 19.89 in March of 2022. Russia Government Bond 10Y - data, forecasts, historical chart - was last updated on July of 2022.
The Russia Government Bond 10Y is expected to trade at 9.34 percent by the end of this quarter, according to Trading Economics global macro models and analysts expectations. Looking forward, we estimate it to trade at 10.09 in 12 months time.