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GKO (abbreviation for Russian: Государственное Краткосрочное Обязательство, translit. Gosudarstvennoye Kratkosrochnoye Obyazatyelstvo, lit. 'Government Short-Term Commitments') are short-term zero-coupon government bonds issued by the Russian Finance Ministry and trade on the Moscow Inter Bank Currency Exchange (MICEX), as well as on five other currency exchanges connected with the MICEX and located in large regional cities. The last GKO auction was held in February 2004.[1]


The issuance of a short-term, ruble-denominated bond was approved by the Supreme Soviet of Russia in February 1993. The first GKO auction was held on 18 May 1993.[1] Foreign investors were allowed into the trade from 1996.[1]

1998 default[edit]

The initials became synonymous with the 1998 Russian financial crisis when the state defaulted on its "GKO obligations" (bonds). The GKO crisis, the most significant financial crisis in post-Soviet Russia,[2] caused turmoil amongst both foreign and domestic investors and creditors. The crisis led to the abrupt devaluation of the Russian ruble in several steps in August and September 1998. (In fact, the ruble first fell about four times, then after some oscillations stopped at that level.) The crisis severely undermined confidence in the ruble's stability, although such dramatic drops did not happen again until 2014.

After 1998 a new series of state bonds was issued. On 1 November 2006, the volume of the GKO-OFZ market reached 850.7 billion rubles at face value, having exceeded by 17.9% the volume reached at the beginning of the year.[citation needed] The market volume is growing as a result of the implementation of the Russian Finance Ministry's policy of substituting the external debt for the internal debt and developing a liquid internal government-securities market, which must give market participants effective instruments to manage liquidity and form benchmarks for risk-free ruble interest-rates for all economic entities.

See also[edit]


  1. ^ a b c "Россия избавилась от комплекса ГКО". Коммерсантъ. 25 November 2014. p. 1. Retrieved 29 September 2018.
  2. ^ Lossan, Alexei (2 December 2014). "Russia to issue short-term state bonds, despite memories of 1998 crisis". RBTH. Retrieved 21 December 2017. in 1998, when the country suffered the most severe financial crisis in its modern history

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