RUONIA Rate Hits 14.75% on Tuesday, Affecting Floating-Rate Bond Coupons

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The RUONIA rate, to which the coupons of a significant portion of exchange-traded floating-rate bonds are linked, stood at 14.75% on Tuesday.

The RUSFAR ON RUB (overnight in rubles) rate adjusted to 14.6% on Tuesday.

RUSFAR ON CNY (overnight in yuan) was 4.9%.

RUONIA is the unsecured overnight ruble lending rate calculated by the Bank of Russia based on transactions from the top 35 banks. RUSFAR (Russian Secured Funding Average Rate), on the other hand, is the secured funding rate (central counterparty repo) calculated by the Moscow Exchange for different terms (ON, 1M, 3M, etc.).

The key difference between the two rates is that RUONIA is an unsecured rate, while RUSFAR is based on secured transactions. Both, however, serve as critical indicators of money market costs and are used for floating rates in bonds.

RUONIA is calculated based on the reporting data of major credit institutions in the form 0409701 "Report on Operations in Foreign Exchange and Money Markets" submitted to the Bank of Russia in accordance with the Bank of Russia Regulation No. 6406-U dated April 10, 2023.

This overview was presented by Alexey Grishchenko, Ph.D., Professor of the Department of Operational and Sectoral Management at the Faculty of "Higher School of Management" of the Financial University under the Government of the Russian Federation.