RUONIA Rate Hits 13.88% on Tuesday, Affecting Floating-Rate Bond Coupons

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RUONIA, the rate to which coupons of a significant portion of floating-rate exchange-traded bonds are linked, stood at 13.88% on Tuesday.

RUSFAR ON RUB (overnight in rubles) adjusted to 13.68% on Tuesday.

RUSFAR ON CNY (overnight in yuan) was 5.08%.

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

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

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

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