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Leaving the key policy rate unchanged, the NBU board said that it could cut it in the future,. "How soon the NBU will adopt an easing cycle will depend on how steadily risks of inflation decrease and inflation expectations improve," the regulator said. "Looking ahead, any changes to the key policy rate will be based on the NBU’s updated macroeconomic forecast that will be published in April."
8.3 Stock market
The National Bank of Ukraine (NBU) has inked an agreement with the international central securities depository Clearstream on the correspondent relations agreement for further opening a securities account at the central bank's depository. "For the first time in its history, Ukraine joins an international securities depository. This step lays the foundation of the upcoming opening of a domestic link between the NBU and Clearstream," the regulator said in a statement on March 13. "Establishing a link with Clearstream simplifies the access of foreign investors to the Ukrainian securities market, namely, domestic government bonds." Settlement of hryvnia-denominated domestic government securities through the ICSD’s system will reduce the transaction and time costs for investors and make these transactions coherent with the best international standards. This will increase "the attractiveness and liquidity" of Ukrainian government securities market, the regulator believes. The Ukrainian government will benefit from expanding the range of sources of long-term financing, reducing the cost of debt and improving the currency structure of public debt due to higher demand for UAH-denominated securities. Thus, the correspondent relations with the international depository Clearstream will provide an inflow of foreign capital to the Ukrainian economy and increase its financial stability, the NBU believes. "This step will be the cornerstone of our upcoming access model for local Ukraine government bonds. We are looking forward to further accelerating our projects in Ukraine with our local partners," Jan Willems, Head of Global Markets at Clearstream, said in the statement.
40 UKRAINE Country Report April 2019 www.intellinews.com