FEATURES OF THE DEVELOPMENT OF THE UKRAINIAN GOVERNMENT BOND MARKET

Abstract

The article is dedicated to exploring key aspects of the development of the market of Ukrainian government bonds. It is established that the market of bonds is a complex socio-economic structure upon which the functioning of the market economy as a whole is based. Its existence contributes to capital accumulation for investment in the productive sector, restructuring of the economic structure, and improvement of the population's living standards through ownership and free disposal of securities. The volume of government bond placements and the relative significance of these operations in Ukraine's financial system are analyzed. Factors that have led to an increased interest in government bonds are highlighted, including the impact of geopolitical events and changes in market conditions. Factors influencing changes in the yield of these securities, such as the government budget deficit, the central bank's policy rate, and other economic indicators, are investigated. The essential conditions for the effective functioning of this market are examined. It has been demonstrated that in the absence of a developed government bond market, the presence of short-term financial instruments limits the bank's capabilities in this direction. The utilization of only short-term bonds for withdrawing excess liquidity leads to an increase in short-term interest rates and encourages investment in such bonds. This situation can create an imbalance in capital attraction in favor of short-term securities. The authors have investigated the significance of the circulation of government bonds, particularly in times of military conflict, as it aids in addressing prevailing issues within the realm of public finances and contributes to bolstering the stability of our nation's economy. The conclusion is drawn that with efficient and transparent utilization, these instruments can positively impact investment processes in the country, leveraging their influence on monetary circulation and money supply regulation. In turn, they also serve as a means to cover the deficits of the national and local budgets, as well as a method for enterprises and individuals to raise financial resources for various purposes. Through government bonds, the state regulates economic development, shapes the level of yield from securities, establishes mechanisms for capital transfer between different segments of the financial market, and addresses other significant socio-economic challenges.