NBU maintained the key policy rate at 15.5%: explains it by supporting the foreign exchange market and savings amid inflation risks
Kyiv • UNN
The National Bank of Ukraine kept the key policy rate at 15.5%. This decision was made due to high inflation expectations and pro-inflationary risks associated with the growing energy deficit.
The National Bank of Ukraine kept the key policy rate at 15.5%, the NBU reported on Thursday, writes UNN.
The Board of the National Bank decided to keep the key policy rate at 15.5%
As noted by the NBU, "despite the decline in inflation in recent months, inflation expectations remain high, and pro-inflationary risks, particularly those related to the growing energy deficit and budget needs, have intensified."
Therefore, under such conditions, "to maintain the attractiveness of hryvnia assets, the stability of the foreign exchange market, and a stable trend of inflation reduction to the 5% target within the policy horizon," the NBU, as stated, will maintain "relatively tight monetary conditions."
The NBU will maintain relatively tight monetary conditions to preserve the stability of the foreign exchange market and the attractiveness of hryvnia savings, and to ensure a sustainable reduction of inflation to the 5% target within the policy horizon.
"Given the intensification of pro-inflationary risks, maintaining the key policy rate at an unchanged level under current conditions is appropriate. This will allow supporting demand for hryvnia savings instruments, maintaining controlled inflation expectations and the stability of the foreign exchange market, which is important for achieving price stability," the regulator noted.
The NBU listed the key conclusions:
- inflation is decreasing, but fundamental price pressure remains
stable, and expectations do not show signs of sustainable improvement;
- the NBU's monetary policy is aimed at reducing inflation to the 5% target within the policy horizon;
- economic growth continues, but its pace will remain moderate due to the consequences of the war;
- the volume of international assistance remains sufficient for non-emission financing of the budget deficit and maintaining an adequate level of
international reserves;
- the course of the full-scale war remains the main risk for inflationary dynamics and economic development;
- monetary conditions continued to ensure the attractiveness of hryvnia
assets, although the impulse weakened. At the same time, they did not hinder the development of lending.