• 26/05/2024 11:32

NBU exceeded bankers' expectations: discount rate reduced by one percentage point

 NBU exceeded bankers' expectations: the discount rate was reduced by one percentage point

According to the decision of the national regulator, from April 26, 2024, the discount rate will be 13.5%, and by the end of the year it may be reduced up to 13%.

The head of the National Bank of Ukraine, Andriy Pyshny, said at a briefing in Kyiv that the NBU board decided to reduce the discount rate by one percentage point (pp). Starting tomorrow, April 26, its size will decrease from 14.5% to 13.5% per annum, which slightly exceeded the expectations of bankers, who predicted its decline to only 14%.

Interfax-Ukraine writes about this.

“Taking into account the weakening of actual and expected price pressure, as well as the reduction of risks for the receipt of international financial support, the National Bank continues the cycle of easing interest rate policy. This will support the development of lending and economic recovery without additional risks to price and financial stability,” the head of the NBU noted.

The regulator also reduced the following rates:

  • on overnight certificates of deposit – to 13.5% (by 1 percentage point);
  • on three-month certificates of deposit – up to 16.5% (by 1 percentage point);
  • for refinancing loans – up to 17.5% (by 2 percentage points).

“Under the conditions of the interest rate policy easing cycle, the advisability of maintaining a significant difference between the rate on refinancing loans and the discount rate decreases,” explained Andrey Pyshny.

The base scenario of the NBU forecast assumes that by the end of the year the discount rate will drop to 13% , which is 1 p.p. less than January forecasts.

“Such easing of interest rate policy and planned steps towards currency liberalization should not create additional threats to macro-financial stability and the stability of the foreign exchange market. The NBU will adapt monetary policy in the event of significant changes in the balance of risks. Thus, reducing the risks for inflation and exchange rate stability may create the preconditions for additional steps to reduce the discount rate and ease currency restrictions, which will support the development of lending and economic recovery,” said the head of the NBU.

Recall that experts assessed what it would be like dollar exchange rate at the end of the year. The average dollar exchange rate in 2024 will be UAH 40.33, but towards the end of the year the value of the American currency will increase.


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