The value of Ukrainian dollar-denominated Eurobonds has decreased by more than 10% since the beginning of 2025, marking one of the worst performances among securities from emerging markets. This negative trend is due to the fact that Western investors’ expectations for a swift end to the war between Ukraine and Russia have not materialized, and the prospects for fulfilling U.S. President Donald Trump’s promises regarding peace initiatives remain unclear.
This is reported by Business • Media
Changes in the Ukrainian Debt Market
At the beginning of 2025, Ukrainian debt was, on the contrary, one of the leaders in growth in the market due to investor optimism regarding a possible cessation of hostilities. At that time, some issues of Ukraine’s Eurobonds nearly doubled in value compared to the level after the restructuring of the state debt that took place in August 2024.
However, the prolonged war has negatively impacted the market. According to analysts at Bank of America Corp., although Ukraine’s external debt remains undervalued, there are ongoing
“downside risks”
to its value as active hostilities continue.
Situation with Zero-Coupon Bonds
Ukraine’s dollar bonds have repeatedly made the list of the worst performers in emerging markets over the past few weeks. This is especially true for zero-coupon bonds maturing in 2035, whose payments depend on the country’s economic indicators. In May 2025, these bonds were trading slightly above 50 cents on the dollar, while in February their price reached around 70 cents.