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December 15, 2017 www.intellinews.com I Page 24
bne:Credit Ukraine raises rates
by 1pp to 14.5%
The National Bank of Ukraine (NBU) increased its key policy rate by 1 percentage point (pp) to 14.5% on December 15 with the aim of tightening its monetary policy, which could contribute to bring inflation down to its target in the mid-term, the regulator said in a statement published on December 14.
Inflation has been driven higher than the NBU was hoping for this year by the government decision to double the minimum wage
at the start of the year and more recently by the food rise in food prices. The regulator was targeting inflation of 12.2% for this year.
In October, the regulator increased its key policy rate by 1 pp to 13.5%. In September, the NBU left its key policy rate unchanged at 12.5% due to the need "to return inflation to the target path". In late May, the NBU cut its key policy rate by 0.5 pp to 12.5%. The move was consistent with the pursuit of inflation targets set for 2017- 2018 and will help drive economic growth in Ukraine.
Albania is reportedly planning a new five-year Eurobond issue of up to €500mn to refinance its declining but still high outstanding external debts.
Last time Albania tapped international financial market was in 2015 when it placed a five-year sovereign Eurobond worth €450mn, with interest rate of 5.75%. The issue was intended for the repayment of the country’s public debt.
The plans for tapping the international market are included in the government’s new 2018-2020 mid-term debt management strategy, daily Tirana Times said in an article on December 12.
Tirana's plans were revealed amid growing investor interest
in comparatively high-yielding sovereign debt from either new or infrequent issuers that has seen frontier markets such as Tajikistan tap international markets. Dushanbe issued raised $500mn from its inaugural international bond in September.
The Albanian government is understood to be planning to refinance its foreign debt without affecting domestic lending, which has been struggling to return to positive growth rates amid poor demand and a high level of non-performing loans (NPLs).
Albania mulls Eurobond issue