**Ukraine’s International Bonds Drop Sharply**
Ukraine’s international bonds fell to their lowest point in over a month on March 3. This was after a heated exchange between Ukrainian President Volodymyr Zelensky and U.S. President Donald Trump last week.
The 2036 maturity bond experienced the biggest decline, dropping by 4.5 cents to 60.775 cents on the dollar. Trading activity remained high, despite the drop in bond prices. This was because investors were worried about the impact of Trump’s comments on Ukraine’s economy.
Ukraine’s GDP warrant also came under pressure, falling around 2 cents to trade at just over 80 cents on March 3. This meant that investors were less confident in Ukraine’s economic prospects.
The drop in bond prices was due to uncertainty about Trump’s willingness to support Ukraine in its war effort against Russia. Tensions had been escalating since mid-February when Trump called Zelensky a “dictator” while improving relations with Russia.
**Impact on Economy**
The new U.S. administration has created pessimism among investors, according to Paul McNamara at GAM. He said that there was no economic reason to invest in Ukraine’s bonds.
Ukraine completed a debt restructuring last September and now owes around $15.2 billion across eight new series of bonds, as well as $2.6 billion on a GDP warrant.
**Response from Kyiv**
The people of Kyiv were asked what they thought about the confrontation between Trump and Zelensky in the Oval Office. Many people expressed disappointment that Zelensky had to cut his visit short due to the argument.
U.S. National Security Advisor Mike Waltz said that President Zelensky needed to regret what happened, sign a minerals deal, and engage in peace talks with Russia.
**Escalating Conflict**
The conflict between Ukraine and Russia is escalating. Russian forces launched 83 drones at Ukraine overnight, according to the Ukrainian Air Force.
Ukraine’s Air Force reported that Russia had increased its drone attacks against Ukraine, using around 150-200 drones per attack. However, this was set to increase to 500 drones in the coming weeks.
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