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Ukraine: National Bank of Ukraine keeps policy rate steady in April
Central Bank decision: At its meeting in mid-April, the National Bank of Ukraine (NBU) decided to leave its key policy rate at 15.50%, following 250 basis points of hikes since November 2024.
Expectations of lower inflation drive decision: The hold was motivated mainly by the Bank’s belief that it has done enough for now to stem price pressures; the Bank stated that inflation should decline in the summer and return to single digits by the end of this year. Moreover, the rise in downward risks to the global and domestic economies following recent and threatened U.S. tariff hikes were likely an additional consideration.
Monetary easing on the cards: The NBU indicated its intention to keep the key policy rate at 15.50% over the coming months and to start cutting rates after inflation peaks. This is in line with our Consensus for the policy rate to end 2025 over 100 basis points below current levels.
Panelist insight: Commenting on the coming Central Bank decisions, EIU analysts said:
“We expect inflation to begin to stabilise in the medium term, and for the bank to be able to start another cycle of monetary policy easing in late 2025 until mid-2027, with the policy rate settling at 8% by the third quarter of 2027.”
