The NBU will continue to cut the key policy rate only in early 2025
Kyiv • UNN
The National Bank of Ukraine forecasts the next key policy rate cut in early 2025. The NBU will maintain an active presence in the foreign exchange market to control inflation and support the hryvnia exchange rate.
The National Bank expects that the next key policy rate cut will take place in early 2025, but will keep the situation under control. This was stated by National Bank Governor Andriy Pyshnyi during a briefing, UNN reports.
Details
According to Pyshnyi, the NBU will maintain an active presence in the foreign exchange market to cover the structural deficit of foreign currency, maintain bilateral exchange rate fluctuations and smooth out excessive volatility.
The NBU aims to ensure that the foreign exchange market remains under control of inflation expectations and that the inflation target is achieved over the forecast horizon. The baseline scenario of the forecast assumes that the NBU will resume its key policy rate cuts only in early 2025. However, the NBU will respond flexibly to changes in the balance of risks to inflation and the FX market
He added that if the risks to inflation and the foreign exchange market ease, the NBU will consider resuming the key policy rate cut cycle as soon as possible.
Recall
The National Bank of Ukraine has decided to keep the key policy rate unchanged at 13% from July 25, 2024. This decision is aimed at ensuring the stability of the foreign exchange market and bringing inflation closer to the 5% target.
