The Ministry of Finance estimated the impact of trump’s victory on the domestic debt market

The situation in the domestic borrowing market has deteriorated after the victory of Donald trump at the election of the President of the United States. This was stated by Deputy Minister of Finance Maxim Oreshkin at the XI international conference “Eurasian economic integration”, the correspondent .

“The outcome of the elections (in the United States. — ) not only affects our external borrowing, but also on the domestic market. We see that the yield on our inner ten-year papers rose to 8,7–8,8% annual. In fact, the situation here has deteriorated. The favorable period for the placing, which was from the beginning behind. Now the market will be a little more carefully to the offer of our securities,” said Oreshkin.

He recalled that the Finance Ministry had previously warned that the possibilities of active borrowing for financing budget deficit has a limit. “Such a situation (the outcome of the elections in the United States. — ) this is clearly demonstrated,” said Oreshkin.

“It is good that we have reserve funds. Well, now that in the coming years, we will reduce the budget deficit and reduce funding needs. Because if we imagine that now we would have been without sovereign wealth funds and the need to Finance large expenditures seasonally in November and December, it would be a big problem. So the ideas that we laid in the next three years, will give us a more stable situation and dynamics”, — said the Deputy head of the Ministry of Finance.

Earlier Oreshkin noted that the outcome of the elections had a negative impact on foreign borrowing of Russia. According to him, the main story, which is now, you need to pay attention to is a sharp rise in us Treasury yields. “Now saw that this morning, the ten-year paper is trading at 2.15% — the highest level this year. This figure is also influenced by the Russia and other EurAsEC countries. For example, if you look Eurobonds, which we placed just recently. We were placed with a yield of 3.9% per annum, they are now traded 4.2 percent. That is 30 basis points — a rise in the cost of borrowing in dollars for Russia,” — said Oreshkin.

He noted that Russia has managed to choose a good time to embed. “When we were placed, ten-year US treasuries were at the level] of 1.55%. They are now at 2.15%. That is, the yield increased by 60 basis points,” said Oreshkin.