RUONIA Rate Drops to 14.50% on Monday, Setting Benchmark for Floaters

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RUONIA, a benchmark rate for floating-rate bonds, fell to 14.50% on Monday.

RUONIA:

- reflects the average cost of overnight ruble loans in the interbank market,

- is calculated daily by the Bank of Russia based on transactions of the top 35 banks.

RUSFAR ON RUB (overnight, rubles) stood at 14.47% on Monday.

RUSFAR ON CNY (overnight, yuan) was 0.5% on the first day of the week.

RUSFAR serves as a key benchmark:

- indicates the level of rates in the Russian money market,

- is formed based on the average values of repo transactions with the central counterparty,

- is included in the list of financial indicators approved by the Bank of Russia.

RUONIA (Ruble Overnight Index Average) is the unsecured overnight lending rate in rubles, calculated by the Bank of Russia based on transactions of the top 35 banks. RUSFAR (Russian Secured Funding Average Rate) is the secured funding rate (repo with a central counterparty), calculated by Moscow Exchange for different terms (ON, 1M, 3M, etc.). The main difference: RUONIA is an unsecured rate, while RUSFAR is a secured rate, but both are key indicators of the cost of money in the market and are used for floating rates in bonds.

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