Bankers generally expect the National Bank of Ukraine to maintain the discount rate on July 25 at the current level of 13% per annum. Interfax-Ukraine writes about this.
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Raiffeisen Bank
“We expect that the NBU will leave the discount rate unchanged at 13%, mainly based on inflation data for June, which has significantly accelerated. If before this, the chances of reducing the policy rate by another 50 bp. looked quite high, then after the release of inflation statistics, in our opinion, they decreased sharply,” said Sergei Kolodiy, chief expert on macroeconomic analysis of Raiffeisen Bank.
Pravex Bank
Artem Krasovsky, Director of the Treasury and Stock Markets Department of the Main Financial Directorate of Pravex Bank, also believes that the regulator will most likely leave the discount rate unchanged due to rising inflation, which is based on an increase in utility tariffs, taxes and excise taxes, as well as on national currency devaluation . However, the banker still does not rule out lowering the rate by 0.5 percentage points.
“It seems likely that the NBU will either temporarily suspend policy easing and monitor further inflation dynamics, or carry out a symbolic reduction by 0.5 percentage points,” Krasovsky noted.
Unex Bank
For his part, Chairman of the Board of Unex Bank Ivan Svitek is inclined to the opinion that the NBU will keep the rate at 13% per annum.
He noted that the increase in consumer prices by 2.2% compared to the previous month is a high figure, although, in general, inflation has not yet reached the central bank’s target of 5% and is below the trajectory of its April forecast.
“This gives reason to talk about a fairly high probability – up to 30% – of a 0.5% rate cut in It’s time for a July revision,” says the head of Unex.
At the same time, Svitek emphasized that potential tax increases, revision of utility tariffs, full transmission of increased electricity tariffs and the appreciation of the dollar could put significant pressure on prices.
OTP Bank
The Chairman of the Board of OTP Bank Volodymyr Mudryi demonstrated the greatest confidence in lowering the key rate.
“The NBU is highly likely to revise the key rate to 12.5%. After all, even taking into account the fact that annual inflation in June increased from 3.3% to 4.8%, it still remains below the level forecast by the National Bank of Ukraine, and the softening of the key rate will contribute to a more rapid resumption of lending and the economy as a whole,” he explained his position.
Mudry allows for a reduction in the key rate by the end of the current year to 10.5-11.5% per annum, while at the same time focusing on significant military and inflationary risks that may influence the NBU’s decision.
- Key rate Banks