Ukraine Interest Rate

The National Bank of Ukraine lifted its key policy rate by 50bps to 13.5% in its December 2024 meeting after keeping the rate unchanged at 13% for three consecutive meetings, marking its first rate hike since the 15 percentage point increase following the Russian invasion. The central bank noted that the rate hike intends to preserve the sustainability of its foreign exchange market controls, keep inflation expectations grounded, and aid disinflation in the Ukrainian economy following evidence of accelerating price growth. The inflation rate rose to 11.2% in November, the highest in over one year, amid a sharp increase in core sections of the consumer basket. The central bank expects inflation to continue rising in coming months, but tighter monetary policy is due to aid the disinflation process before the gauge returns to the 5% by the end of next year.