The national Bank lowers the discount rate

Нацбанк снижает учетную ставку

In August last year the rate reached 30%

From April 22 the discount rate is reduced to 19% from 22%.

The national Bank from April 22 decided to cut the interest rate to 19% from 22%, where it was installed in September last year. This is stated in the press release of the NBU.

“This became possible due to a significant reduction of risks to price stability”, – stated in the message.

As noted by the NBU, the risks for higher inflation compared to targets that constrained the monetary policy easing in the first quarter, since the previous meeting of the Board of the NBU on monetary issues are significantly weakened.

“In particular, political tensions have decreased due to the formation of a new government, and external risks – due to the resumption of transit of Ukrainian goods through Russian and a gradual increase in the prices of domestic exports. However, today, the key risk remains a delay in the resumption of Ukraine’s cooperation with the IMF. Accordingly, critical is the determination of the newly formed government to continue urgent reforms”, – stated in the message.

As noted by the NBU, in case further risks to price stability monetary policy easing will continue.

In addition, the NBU has kept the growth forecast of real GDP of 1.1% in 2016, 3% in 2017.

Forecast the current account deficit also remained almost unchanged compared to previous estimates ($2.3 billion or 2.7% of GDP in 2016 and $1.8 billion and 1.9% of GDP in 2017).

Earlier, the NBU said that allows the reduction of interest rates in 2016 to a value slightly exceeding the projected inflation rate of 12%.

We will remind, from September 25, 2015 the NBU decreased the discount rate from 27% to 22% per annum, and also reduced the refinancing rate under credits overnight against collateral of government securities from 29% to 24% per annum.