Ukraine’s central bank lowers key policy rate, for first time in a year
The Board of the National Bank of Ukraine has decided to cut the key policy rate from 25 percent to 22 percent, it was announced on Thursday.
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"Rapid disinflation and sustained FX market conditions enabled the central bank to start the cycle of key policy rate cuts", Ukraine’s central bank, the NBU, said in a statement.
Taking into account an improvement in inflation expectations and projected further disinflation, the current and forecast rate cuts conform to maintaining the attractiveness of hryvnia savings, the Ukrainian central bank believes.
"This is an important element of ensuring exchange rate sustainability amid the easing of FX restrictions and shifting to a more flexible exchange rate.
"At the same time, reducing the key policy rate against the backdrop of sustained macrofinancial stability will support economic recovery."
The NBU raised the key policy rate to 25 percent in March 2022, soon after Russia’s full-scale invasion of Ukraine.
