Ukraine’s National Bank keeps key policy rate at 13%, extends forecast until summer 2025

The National Bank of Ukraine's (NBU) Board decided on Thursday to keep its key interest rate at 13%, planning to hold it at this level until summer 2025. Previously, the central bank had anticipated easing the rate starting in Q1 2025.

"The Board of the National Bank of Ukraine has decided to keep its key policy rate at 13%. Coupled with maintaining the sustainability of the FX market, this decision will allow keeping inflation expectations under control, slow down inflation next year, and bring it back to the 5% target going forward," the regulator stated in its Thursday press release.

The NBU emphasized that inflation has yet to peak and that inflationary risks have even intensified in the coming months. Consequently, the bank considers it wise to proceed cautiously with interest rate policies, taking measured steps to ensure currency market stability.

"If pro-inflationary risks continue to materialize, the NBU stands ready to deploy all available monetary policy tools," the National Bank said.

The NBU's updated forecast projects the key interest rate will remain at 13% annually until next summer. However, if price pressures increase beyond expectations and inflation expectations destabilize, the NBU will be prepared to tighten its rate policy further and take additional monetary measures.