Page 60 - UKRRptAug22

8.2 Central Bank policy rate
The National Bank of Ukraine (NBU) left its monetary policy interest rate at 25% at a meeting on July 21. The central bank also decided to devalue the currency by 25% to UAH36 to the dollar on the same day in an effort to bring the official exchange rate into line with the cash rate that exchange kiosks are using.
The NBU more than doubled interest rates from 10% in June to fight soaring inflation and support the currency.
The NBU will keep the interest rate at 25% for the next two years. Ukraine’s central bank devalued the hryvnia and said it might keep interest rates at 25% for another two years to protect its dwindling foreign-currency reserves as Russia’s invasion ravages the economy. The National Bank of Ukraine said the “shift in the fundamental parameters” of Ukraine’s economy during the war and the dollar’s strengthening triggered the currency adjustment. It set the official hryvnia rate at 36.57 per dollar compared with 29.25, where it had been frozen for the past five months. The devaluation comes a day after Ukraine’s request to postpone foreign debt payments won support from key creditors, including the US.
60 UKRAINE Country Report XXXX 2018 www.intellinews.com