Ukrainian Eurobond prices have fallen sharply in recent weeks as investors abandon expectations of a swift ceasefire with Russia, shifting their focus instead to potential external financing for Kyiv in the coming years, reported Ukraine Business News.

Investment company ICU said the lack of progress in diplomatic efforts to end the war had become increasingly evident, pushing investors to weigh prospects for fresh support in 2026-2027 from the IMF and EU. They noted particular attention was being paid to the possible use of frozen Russian assets to shore up Ukraine’s finances.

Ukrainian Eurobonds have dropped by nearly 10% from their August highs, erasing gains made around the time of the meeting between US President Donald Trump and Russian President Vladimir Putin, ICU said. The sharpest losses were in the 2035-2036 B-series bonds, which carry provisions for extra issuance if Ukraine’s GDP outpaces IMF forecasts for 2024. Those securities have slumped more than 15%.

“The market has recalibrated its expectations,” ICU analysts wrote in a research note. “Without tangible diplomatic progress, the discussion has moved toward whether Ukraine can secure additional multi-year support packages and how these would affect debt sustainability.”

Ukraine’s debt-to-GDP ratio is already set to rise significantly, and analysts warned that further borrowing without collateralisation through Russian assets could undermine investor confidence. The IMF is expected to reassess debt sustainability in light of additional aid flows, a move that could weigh further on Eurobond prices.

Kyiv has relied on substantial Western financial assistance to stabilise its economy since the war began in 2022. While commitments from the EU, the United States and other partners have kept financing channels open, uncertainty over the pace and form of future support continues to drive volatility in Ukrainian debt markets.