Yesterday, price movements on the OFZ market remained minimal. The curve opened flat, but the quotes soon slipped 0.1pp into the red. However, RUB’s stronger performance helped to regain positions by the close, so the curve yields moved down 2-3bp in a parallel shift. The belly added 0.1pp in price, while the long end returned to previous close levels. RFLB 23 (YTM 11.52%, series 26215) outperformed, rising 0.3pp in price. Speaking about relative valuations, we think that bullet issues look fairly priced against the money market and key rates, which we expect to underpin demand from local banks. At the same time, inflation-linked OFZ looks tight, with the inflation break even rate at 8%. In our view, the inflation outlook for next year remains fairly positive: thanks to the base effect, we expect inflation to moderate to about 7% in 2016. The key upside risks are the negative pass-through from a weaker currency and the fiscal policy stance.