Ukrainian eurobonds are rising: investors hope for a swift end to the war
Recent political events in the United States have significantly impacted global financial markets, particularly the demand for Ukrainian eurobonds (UZDP). With the election of Donald Trump as president, investors are showing optimism about a possible end to the war in Ukraine, which has driven up eurobond prices.
Our view:
The newly elected US president, Donald Trump, is beginning to form his team by nominating candidates for key positions that will strongly influence US foreign policy. In particular:
- Marco Rubio — Secretary of State
- Michael Waltz — National Security Advisor
- Pete Hegseth — Secretary of Defense
- John Ratcliffe — Director of the CIA
- Tulsi Gabbard — Director of National Intelligence
- Kristi Noem — Secretary of Homeland Security
The most critical roles for shaping foreign policy are the National Security Advisor, Secretary of Defense, and CIA Director. Their positions and experience may determine the future US–Ukraine relationship regarding the achievement of peace.
Analysis of the candidates’ statements and experience suggests that, despite the new administration’s desire to end the war quickly, most of them have “hawkish” tendencies — favoring strong deterrence against US opponents. This may accelerate decisions to provide military aid to Ukraine. However, it is important to note that these candidates are loyal Trump supporters and will likely follow his agenda even if it differs from their personal views.
To facilitate a rapid end to the war, Trump plans to appoint a special envoy to lead negotiations on the issue. However, his vision of a “quick peace” may not align with the concept of a “just peace.”
Market reaction to Trump’s election has been notable — investors believe the new US president will achieve significant progress in ending hostilities. As a result, demand for Ukrainian eurobonds (UZDP) has risen, with prices increasing by 8–14% over the past ten days.
OTP Capital believes that final conclusions about the new president’s policies can only be made after his inauguration (January 20, 2025) and the first tangible steps. For now, campaign statements remain words, but market optimism is an important signal for Ukraine.
