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contributed to higher cost of other goods and services.
"The above factors and the approaching presidential and parliamentary elections to take place next year affected the inflation expectations," the NBU added. "In particular, expectations of households deteriorated. Businesses, banks, and financial analysts maintain high inflation expectations, at levels much above the NBU’s inflation targets."
The NBU promised "to keep a close watch2 on factors of underlying inflationary pressures, in particular on consumer demand, inflation expectations and any progress achieved in ensuring cooperation with international official lenders. If inflation pressures do not ease or build up, the central bank could raise the key policy rate again.
8.3 Stock market
8.3.1 Equity market dynamics
Ukraine is going to join the Clearstream global securities depository system in the first quarter of 2019 , opening access for international investors to its domestic bond market, the National Bank of Ukraine (NBU) said in a statement on October 1. The project is being implemented by the NBU, Clearstream and Deutsche Börse group. Using the Clearstream system, investors will be able to make payments for Ukrainian government bonds in Ukraine's national currency, which will cut transaction costs. The NBU believes that this will also raise demand for Ukrainian securities, fostering their liquidity. In turn, the Ukrainian government will benefit from access to international sources of long-term lending and lowered costs of debt resources. The project is "an important step in transforming Ukraine into a full-fledged player at the international debt markets," the NBU's governor Yakiv Smoliy said in a statement. According to Evgeniya Akhtyrko at Kyiv-based brokerage Concorde Capital, non-residents hold only 1% of the Ukrainian government’s local debt. "Meanwhile, the ability of local market players to general debt resources for the finance ministry is weak," she added in a note on October 2. "Nevertheless,
53 UKRAINE Country Report November 2018 www.intellinews.com