Economy 2021-06-15T06:40:36+03:00
Ukrainian news
NBU Raises Discount Rate From 14.5% To 16%

NBU Raises Discount Rate From 14.5% To 16%

economy, NBU, discount rate, inflation

The National Bank of Ukraine has raised the discount rate from 14.5% to 16%.

The National Bank of Ukraine announced this in a statement, Ukrainian News Agency reports.

The statement reads that inflation sped up to 12.4% compared to 2016, mainly due to factors on which monetary policy tools have only a limited effect.

In particular, acceleration of inflation was mainly driven by a decrease in the supply of some foods resulting from the unfavorable weather conditions seen in the first half of last year, the unstable situation in animal breeding, and a rise in the global prices of, and demand for, Ukrainian foods, mainly meat and dairy products.

An increase in production costs, especially labor costs, and fast recovery of consumer demand also contributed to the growth of prices.

In addition, the end of last year saw an increase in hryvnia exchange rate fluctuations and a noticeable easing in fiscal policy, thanks to, among other things, sharp increase in pension payments and budgetary spending being unevenly distributed over the year.

This increased underlying inflationary pressure, as evidenced by a rise in core inflation, to 9.5% in December, and high inflation expectations.

The next meeting of the monetary committee will be on March 1.

As Ukrainian News Agency earlier reported, since March 4, 2015, the National Bank of Ukraine raised the discount rate from 19.5% to 30%.

Then, the National Bank several times retained the discount rate at 30%.

On August 28, 2015, the central bank lowered the discount rate to 27% and on September 25, 2015 to 22%.

On April 22, 2016, the National Bank further reduced the rate from 22% to 19%, on May 27 - to 18%, and on June 24 cut it further to 16.5%.

On July 29, 2016, the central bank reduced the discount rate from 16.5% to 15.5%, and on September 16, 2016 cut it down to 15%.

On October 28, 2016, the NBU reduced the discount rate from 15% to 14%, in December 2016 and January 2017 kept it at that level, and in April 2017 dropped it further to 13%, and in May 2017 to 12.5%.

In October 2017, the central bank raised the discount rate to 13.5% and to 14.5% in December 2017.

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