NBU forecasts the key policy rate reduction in the second quarter of 2022.

One of the main drivers of such inflation dynamics is the sustained high price level in the global commodity markets. Inflation in Ukraine’s MTPs also remains high, although in August there were signs of a slowdown. Raising the key policy rate to 8.5% in 2021 and rolling back the emergency monetary measures will be sufficient to ease inflationary pressures and return inflation to 5% in 2022 announced the NBU Monetary Policy Committee.

In the latest turmoil at the central bank, the nine top leaders of the licensing department quit en masse yesterday,

charging a lack of transparency and autonomy under the new governor who took over one year ago. “Today, the National Bank of Ukraine has deviated far from these standards,” Oleksandr Bevz, former director of the department, wrote yesterday on Facebook. “This threatens to roll back reforms in the banking sector and in regulation of the non-banking sector.” The bank, now run by Kyrylo Shevchenko, said on its website: “The licensing department has 107 employees and continues to operate as usual.”

Ukraine’s central bank welcomed a decision by the Bank of England on Friday

that it approved the “bail-in” of $595 million of loans that a British-based financial company made to PrivatBank before it was nationalized in 2016, Reuters reports. In a statement, the National Bank of Ukraine said the decision by Britain’s central bank bolstered Kyiv’s argument the nationalization had been carried out within the framework of a reliable legal procedure and complied with international standards.

The National Bank has simplified regulations for Ukrainian companies seeking to issue debt securities on the international market,

the NBU said. The following amendments were introduced: “transactions to distribute income on and redeem Eurobonds as well as other issuer transactions for the purpose of placing such securities were removed from the list that is subject to a EUR 2 million annual limit; foreign currency can be bought to be deposited on the own account of the issuer with a Ukrainian bank until the maturity date of liabilities under Eurobonds.”

“The Ukrainian economy requires additional funds for development more than ever. One of such sources is international loans.

The regulator observes increasing interest of Ukrainian companies to the possibility to attract foreign funding, including through Eurobond placement. The amendments approved by the NBU will streamline the terms and conditions for raising funds and increase capital inflows into the Ukrainian economy and promote the country’s investment potential,” said Yuriy Heletiy, NBU Deputy Governor.

The Finance Ministry raised the equivalent of $370 million at its weekly auction yesterday,

the Ministry reported on its Facebook page. Yields in hryvnia reflect the Central Bank’s increase in the nation’s prime rate 10 days ago to 7.5%. The yields were: 6-month – 9%; 1-year – 11.2%; 1.5 year – 11.3%; 2-year – 11.96%; 3-year – 12.28%. In the foreign currency placements, the Ministry sold $21 million worth of 1-year dollar bonds at 3.7% and €42 million worth of 1-year euro bonds at 2.5%.

Demand for dollars hit a 4-year high during the recent military standoff between Russia and Ukraine

, Bohdan Danylyshyn, chairman of the National Bank of Ukraine, announced on the banks Facebook page. Since the start of April, Ukrainians bought $422 million more dollars than they sold, according to Central Bank figures. By comparison, the figure in March was $182 million. After Russia’s Defense Minister promised on Thursday to withdraw troops from positions near Ukraine, the hryvnia strengthened against the dollar by 0.5%.

The escalating military standoff with Russia is cutting foreign demand for domestic government bonds,

Yuriy Geletiy, a deputy governor of the National Bank of Ukraine, told reporters yesterday. “Prior to Russia’s concentration in the East, investors were actively buying IGLBs,” he said, referring to the bonds. “Unfortunately, Russia’s provocative actions at the border have worsened investors’ assessments of the Ukrainian market’s prospects. There is little demand from nonresidents.”

The National Bank of Ukraine also downgraded its forecast for real GDP growth in 2021 to 3.8%, from 4.2%.

“The introduction of new quarantine restrictions has led to the suppression of business activity,” the bank said. “The effect of last year’s low harvests affected the indicators of agriculture, food processing and cargo turnover.” After a 2.8% drop during January-February, growth should return in the current second quarter, the bank predicts. The World Bank also predicts 2021 GDP growth of 3.8%.

Capital investment by cross border investors in Ukraine decreased by $868 million last year, the first decline of Incoming Investment since 2015,

Bohdan Danylyshyn, Chairman of the National Bank of Ukraine wrote on Facebook. He said: “The key reasons for the low interest of foreign investors in the Ukrainian economy are the weak and underdeveloped domestic market, the ongoing military conflict with the Russian Federation, as well as the low level of legal protection of investments.”

JCB, Japan’s largest credit card company, is entering the Ukrainian market.

  It will be the fifth international card payment system in Ukraine with a non-resident payment organization, reported the National Bank of Ukraine. The 50-year-old Tokyo-based company has 5,000 employees and 130 million cardholders in 23 countries. Around the world, JCB has alliances with Discover Network in the US, UnionPay in China, RuPay in India and American Express in Canada.

For the first time since the coronavirus pandemic hit Ukraine, business expectations have moved into the positive

territory of the Central Bank’s monthly survey. The mood inched up to 51.4 points, the first time since February 2020 that the index of business prospects have crossed the 50-point equilibrium, reported the National Bank of Ukraine. The survey of 269 companies was taken March 3-24, before the latest imposition of quarantine restrictions.

The share of UZ cars in freight trains has dropped in half – from 47% in 2018 to 21% in 2021

The share of UZ cars in freight trains has dropped in half – from 47% in 2018 to 21% in 2021, Zhmak said. This year, Zhmak wants to increase the UZ portion to 40%. Private cars are more popular because they are cheaper and in better shape. Critics charge UZ drags its feet on pilot projects to allow private freight trains on UZ tracks.

Former Ukrzaliznytsia CEO Wojciech Balczun is co-owner of Aurum Polonez, an amber mining company in Klesiv, northern Rivne oblast

Former Ukrzaliznytsia CEO Wojciech Balczun is co-owner of Aurum Polonez, an amber mining company in Klesiv, northern Rivne oblast, according to Nadra.info. A Polish rock musician, Balczun ran UZ in 2016-2017. His partners are Poland’s Amos Investments and Mykola Nemtsov, who was UZ’s acting director of security during Balczun’s time at the railroad.

Egis Ukraina, a French-financed engineering company working in Ukraine for the last three decades,

Egis Ukraina, a French-financed engineering company working in Ukraine for the last three decades, has entered into a joint venture with Ertle, Ltd, an international engineering and construction holding, known locally as Derffer. The new company is called Egis Ertle Engineering. Ignace Haertlé, founder of the Ertle Group and major Derffer shareholder, notes that the company worked on the NOVARKA new safe confinement for Chornobyl, saying: “Through the years, we have delivered projects for both international and local clients including

Half of Ukrainians seeking work abroad want to go to Poland, with two thirds looking for seasonal work,

Half of Ukrainians seeking work abroad want to go to Poland, with two thirds looking for seasonal work, according to an OLX Work survey last month of 7,700 Ukrainian job seekers. The other top two destinations are: the Czech Republic – 11%; and Germany – 9%. The primary reasons are: high salaries in the EU – 60%; and difficult financial situation at home – 39%. Construction and factory work account for half of the jobs sought.

Resistance to vaccinations against the coronavirus is high and growing in Ukraine,

Resistance to vaccinations against the coronavirus is high and growing in Ukraine, the AP reports in an article headlined: “Wide resistance to vaccines plagues Ukraine’s COVID-19 fight.” The portion of poll respondents who do not want to get vaccinated rose from 40% in February to 60% in March 2021, according to polls of 1,200 Ukrainians conducted by the Kyiv International Institute of Sociology. In the first half of 2019, resistance to measles vaccinations lead to 5,000 cases in Kyiv and

The Health Ministry reported that 40% of medical workers say they do not want to be vaccinated.

The Health Ministry reported that 40% of medical workers say they do not want to be vaccinated. In the Donetsk village of Selydove, a visiting AP reporter found that only 5% of medical workers agreed to be vaccinated. Thirty kilometers away, in the frontline town of Krasnohorivka, AP reported: “Soldiers widely refused to be vaccinated.”

Ukraine and Israel are negotiating mutual recognition of “vaccination passports” for tourist travel

Ukraine and Israel are negotiating mutual recognition of “vaccination passports” for tourist travel, Yevhen Korniychuk, Ukraine’s Ambassador to Israel, told Ukraine 24 TV. In September, more than 4,000 Hasidic Jewish pilgrims plan to travel to Uman, Cherkasy region, for the High Holidays. Although Israel has the world’s highest vaccination rate for a major country – 44% — some Orthodox Jews refuse to be vaccinated.

Passenger traffic at Kyiv Boryspil was down by two thirds during the first two months of this year

Passenger traffic at Kyiv Boryspil was down by two thirds during the first two months of this year, compared to January-February 2020, reported the Center for Transportation Studies. With UIA’s suspension of its hub system, transfer passengers were down 94%, to 20,018. Passengers on regular, scheduled flights were down 75%, to 373,726. Faring best were vacationers on charter flights, which were down by 30%, to 298,332.

In the last six months, Ukraine’s Central Bank has moved from collegiality to Soviet-style centralism

In the last six months, Ukraine’s Central Bank has moved from collegiality to Soviet-style centralism, Kateryna Rozhkova, First Deputy Governor of the National Bank of Ukraine, said in a lengthy interview with NV. “There’s actually a rollback,” she says. Relations with the new Governor of the Central Bank have become so frosty that they only communicate in group meetings, on Zoom. She said: “If there are any questions and I comment on something, he comments on something. It does not

Hours after the interview with NV was posted

Hours after the interview with NV was posted on Facebook yesterday, the bank’s communications department tried — unsuccessfully — to censor the interview. Rozhkova also complained that she is no longer invited to key meetings and that her opinions are not heard on PrivatBank, the bank she helped to nationalize in 2016. In response, Galyna Kalachova, the bank spokeswoman, wrote on Facebook that Rozhkova had been asked to edit the text to reflect bank policy. She wrote: “One-voice policy is

Independence of the Central Bank became the critical issue with the IMF last summer

Independence of the Central Bank became the critical issue with the IMF last summer after President Zelenskiy pushed out the internationally known and respected governor, Yakiv Smoliy. In the ensuing shakeup, several top officials left the bank and Rozhkova’s responsibilities were reduced. The public dispute comes one week after the bank raised prime for the first time in two year, to 6.5%. President Zelenskiy favors easy money policies.

With the $5 billion IMF lending program to Ukraine suspended, Bloomberg and Reuters moved stories yesterday on the spat

With the $5 billion IMF lending program to Ukraine suspended, Bloomberg and Reuters moved stories yesterday on the spat. Bloomberg headlined: “Another Ukrainian Central Banker Speaks Out on Governance Fears.” Reuters headlined: “Ukraine central bank denies it tried to censor top official.”

Ukrzaliznytsia passenger service – which has been hemorrhaging money loser – lost 26% more of its income in the last year, a total of $314 million

Ukrzaliznytsia passenger service – which has been hemorrhaging money loser – lost 26% more of its income in the last year, a total of $314 million, said Volodomyr Zhmak, the state railroad’s CEO, yesterday. Due to quarantine restrictions on travel, passenger traffic decreased by 56%, to 68 million passengers. Estimating that the railroad’s locomotives and cars are “90% worn out,” Zhmak praised the government for allocating $145 million this year for the renovation of rolling stock. In Ukraine, freight subsidizes

With new coronavirus cases doubling this week,

With new coronavirus cases doubling this week, Prime Minister Shmygal warned yesterday: “It’s obvious that the third wave of the pandemic has started that Ukraine is facing.” Yesterday morning, 10,057 new cases were registered, more than double Monday’s level of 4,285. “If the situation worsens, if we see that medics are not coping, then we will probably have no choice but to impose strict quarantine like the one that we have already experienced.”

The new cases are largely in Kyiv and to the West

The new cases are largely in Kyiv and to the West: Zhytomyr Oblast – 888; Kyiv City – 868; Vinnytsia Oblast – 827; Ivano-Frankivsk Oblast – 776; and Zakarpattia – 676. Ukraine’s first two cases of the British coronavirus variant, were detected in Ivano-Frankivsk region, health officials said yesterday.

Ukraine plans to become a major producer of lithium batteries for Europe’s electric cars

Ukraine plans to become a major producer of lithium batteries for Europe’s electric cars, Prime Minister Shmygal told reporters yesterday, reviewing talks he had in Brussels last month. By 2030, Europe will need 18 times more lithium than now, by 2050, 60 times more, he said. “Ukraine has the largest lithium deposits on the European continent,” he said. “Europe sees Ukraine as a partner, both in production and processing…We are interested in added value, production, processing, and the maximum creation of

Coal miners may become lithium miners

Coal miners may become lithium miners under a pilot project to start closing two coal mines this year, one in Lviv and the other in Donetsk, the Prime Minister. With German and Polish advice and aid, Ukraine’s “Fair Transformation of Coal Regions” project could involve employing some coal miners to work in new lithium mines, he said.

Turkey and Ukraine are on the final stretch for finalize a bilateral free trade agreement

Turkey and Ukraine are on the final stretch for finalize a bilateral free trade agreement, Shmygal told reporters. Of the long-delayed agreement, he said: “Literally, last week and this week the free trade agreement with Turkey is being finalized.”

In a new twist on the Motor Sich drama, David Arakhamia, the head of Servant of the People faction in the Rada

In a new twist on the Motor Sich drama, David Arakhamia, the head of Servant of the People faction in the Rada, said yesterday he will submit a bill to nationalize the Zaporizhia-based aircraft engine manufacturer. On Jan. 29, President Zelenskiy barred Chinese investors from asserting control. “It is to settle the legal status of the company, that is a large constructor of helicopter engines,” Arakhamia said. “Because the company is facing uncertainty, it is being sanctioned upon, and several

Although last year’s Dnipro shipping season was six weeks longer than usual, cargo dropped 5% yoy, to 11 million tons

Although last year’s Dnipro shipping season was six weeks longer than usual, cargo dropped 5% yoy, to 11 million tons. “Results of cargo transportation were influenced by the reduction in grain transportation on navigable rivers,” says Dmitry Kozachenko, executive director of the Rivers of Ukraine Association. Volumes on Ukraine’s portion of the Danube were down 28%, to 4 million tons. On the Southern Bug, volumes were down 37.5%, to 500,000 tons. The big products moved down Ukraine’s three largest navigable

With traffic jams clogging Kyiv’s Dnipro bridges, the City Council is studying restoring boat service across the river.

With traffic jams clogging Kyiv’s Dnipro bridges, the City Council is studying restoring boat service across the river. According to Kiev Vlast, the River Port Administration calculates that 2,000 people a day would commute by ferry, following this route: Rusanivka, Bereznyaki, Dnipro Metro station, Podil River Port. Depending on the boat and the weather, the entire trip would take one hour. Tickets would cost UAH 30-60, $1-2.

In January-February, Ukrainians imported 53,000 used cars, 4.4 times the volume of the first two months of 2019

In January-February, Ukrainians imported 53,000 used cars, 4.4 times the volume of the first two months of 2019. Used imports, a rarity four years ago, now account for 81% of car imports, reports Ukravtoprom, the vehicle industry association. In 2020, 353,400 used imports and 85,500 new imports were registered in Ukraine.

More hikes could come this year,

More hikes could come this year, Yuriy Geletiy, a deputy governor of the central bank, told reporters yestrerday. “The National Bank is ready to raise the discount rate more decisively to limit the fundamental inflationary pressure and bring inflation to the target. Therefore, monetary policy will continue to focus on preventing the inflation spike.”