The OFZ market traded a bit softer yesterday, with longest bond down 0.2-0.3pp price wise; the whole curve moved up 5-7bp. In particular, RFLB 28 closed at a yield of 11.56%, while RFLB 20 6.40 ended at 11.96%. Separately, MinFin announced two OFZ auctions for today, offering RUB 10bn of RFLB 23 and RUB 15bn of RUONIA-linked RFLB 17.
February was the last time the bullet RFLB 23 paper was placed, so we expect good demand here, as the long end looks squeezed in terms of liquidity. Despite modest demand for floating RFLB 20 last week, we believe that RFLB 17 has a chance of meeting good demand too, as it is clearer for the market in terms of coupon structure due to its short duration.