Published by Global Banking & Finance Review®
Posted on December 29, 2025
3 min readLast updated: January 20, 2026
Ukraine's bonds surged as peace talks with Russia show progress. Investors optimistic about conflict resolution and financial support.
LONDON, Dec 29 (Reuters) - Ukraine's government bonds rallied on Monday as investors saw some positive signs in talks on a deal to end the war with Russia, with some bonds hitting their highest since emerging from last year's $20 billion sovereign debt restructuring.
There was progress on security guarantees for Kyiv at talks between U.S. President Donald Trump and Ukrainian leader Volodymyr Zelenskiy on Sunday but Russia and Ukraine on Monday remained far apart on the main territorial issues blocking a peace agreement.
Ukraine's bonds have surged in the last 1-1/2 months amid a renewed push to halt the near four-year-old war and most added another 1 cent on the dollar on Monday, following a busy weekend of diplomacy.
U.S. President Donald Trump said on Sunday that he and Ukrainian President Volodymyr Zelenskiy were now "getting a lot closer, maybe very close" to an agreement to end the war.
Trump and Russian President Vladimir Putin held a call on Monday with Moscow also saying Ukraine had tried to attack Putin's Dolgiye Borody, or Long Beards, residence in northern Russia, an accusation that Kyiv denied.
Hopes for peace have been repeatedly dashed over the last year, but the moves in Ukraine's bonds have signalled renewed optimism, among investors at least, that a truce might now be within reach.
Monday's gains notably left Ukraine's 4.5% coupon 2034 and 2035 bonds - two of its most widely-traded - almost exactly where they were in early February before Trump's branding of Zelenskiy as a "dictator" and then scolding of him in the Oval Office triggered a major collapse in prices.
The bonds have also been boosted over the last six weeks by plans for a new four-year, $8.2 billion International Monetary Fund programme and a 90 billion euro ($105.83 billion) European Union loan to shore up the government's finances.
Kyiv has also just struck a long-awaited deal to replace the so-called 'GDP warrants' that helped it clinch is 2015 post-Crimea annexation debt restructuring, but had risked draining its finances once the current war ends.
Despite their widespread gains, not all of Ukraine's bonds are above or back to their early February highs.
Two where the payments are linked to the country's future economic growth rather than via regular coupons, and that won't mature for at least another 10 years, remain well below, at roughly 57 cents on the dollar, compared to almost 70 cents back in February.
($1 = 0.8504 euros)
(Reporting by Marc Jones; Editing by Susan Fenton)
The IMF is an international organization that aims to promote global economic stability and growth by providing financial assistance and advice to member countries.
Emerging markets are countries with developing economies that are in the process of rapid growth and industrialization, often characterized by increased investment opportunities.
Debt sustainability refers to a country's ability to manage its debt levels without requiring debt relief or accumulating further debt, ensuring long-term financial stability.
Explore more articles in the Finance category
