NBU expectedly keeps key policy rate at 15.5%
The Board of the National Bank of Ukraine (NBU) has decided to keep the key policy rate at 15.5% per annum, which, in its opinion, will support the stability of the foreign exchange market and controllability of inflationary expectations, which will contribute to the further weakening of price pressure.
"The NBU will stick to a rather tight monetary stance as long as it is needed in order to ensure that inflation is steadily declining toward its 5% target over the policy horizon," the National Bank said in a press release on Thursday.
The central bank emphasized that inflation has started to decline as expected, and inflation expectations remain under control.
As for the situation in the foreign exchange market, it has been stable, in particular, thanks to the NBU's previous measures to tighten interest rate policy. Fluctuations of the hryvnia against the US dollar have been moderate, and the weakening against the euro has so far had a minor pro-inflationary effect.
The NBU forecasts that inflation will decrease significantly by the end of this year, with its reduction to the target expected in 2027.
Market participants on the eve of the rate decision were also almost unanimous in their forecasts that the NBU would maintain it at the current level.
