RUONIA Rate Hits 13.82% on Monday, Benchmark for Floaters

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RUONIA, a benchmark for floating-rate bonds, rose to 13.82% 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 13.81% on Monday.

RUSFAR ON CNY (overnight, yuan) was 0.8% 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.

It is important to note that 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, while RUSFAR (Russian Secured Funding Average Rate) is the secured funding rate (repo with a central counterparty), calculated by the Moscow Exchange for different terms (ON, 1M, 3M, etc.). The main difference: RUONIA is an unsecured rate, while RUSFAR is based on secured transactions. Both are key indicators of the cost of money in the market and are used for floating rates in bonds.

This overview was provided by Alexey Grishchenko, Ph.D., Professor at 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.