The National Bank of Ukraine might allow key policy rate reduction in 2023.

 The members of the Monetary Policy Committee of the NBU, for the fourth time in a row, unanimously spoke in favor of maintaining the discount rate at the level at 25%, while several members supported a reduction of the rate by 2-4% as soon as 2023, reported the NBU. Thus, all participants in the discussion agreed that keeping the discount rate at 25% during the last six months and fixing the official exchange rate and measures to regulate the foreign exchange market have become essential to maintaining macro-financial stability. The members of the committee also noted that the NBU’s consistent communication regarding its steps and deatermination in its intentions regarding implementing a long-term, relatively tight monetary policy affected the gradual increase in bank rates for hryvnia deposits. As a result, there was a break in the trend toward a decrease in the share of time deposits by consumers. The effects of the June increase in the discount rate have not yet been exhausted, and there is still considerable room for further transmission to market rates.