- Decision
- Maintain
- Rate change
- 0 bps
- key policy rate
- 15%
The Board of the National Bank of Ukraine (NBU) kept the key policy rate at 15 % per annum, shelving the further easing envisaged in its January forecast amid higher-than-expected energy prices, a pick-up in February headline inflation to 7.6 % y/y (core 7.0 % y/y) and a marked deterioration in households’ inflation expectations. The rate has been lowered by a cumulative 50 bp since January 2026 after being held at 15.5 % through most of 2025. By maintaining “appropriate monetary conditions” the NBU seeks to preserve the attractiveness of hryvnia assets and FX-market sustainability; retail term deposits and domestic government securities continue to expand, while bank lending is growing at over 30 % y/y. Official inflows of USD 5.5 bn since the start of the year have helped keep international reserves close to USD 55 bn, supporting exchange-rate stability despite recent USD strength. The central bank highlighted the Middle East conflict as a new driver of global energy costs and inflation risk. It signalled that it will refrain from further cuts while risks persist and stands ready to raise rates and deploy additional measures should pressures intensify.
Rate evolution
Over the period, the National Bank of Ukraine held its key policy rate at 15.5% through 2025, cut it by 50 basis points to 15% in January 2026, paused, and subsequently raised it in two 50-basis-point steps to 16%. Through most of 2025, it kept a tight stance to support FX market sustainability and keep inflation expectations in check as inflation, peaking in May and then slowing, remained above forecast at times and underlying pressures from wages, labor shortages, energy costs, demand and war-related disruption persisted. Late in 2025, the risk balance turned more hawkish, with greater emphasis on energy shortages, larger budgetary needs and uncertainty over external assistance, even as harvests and official financing supported disinflation and reserves.
After the January cut, the NBU held at 15% as inflation rose on energy and fuel prices linked to the war in the Middle East, hryvnia weakness and faster wage growth, before raising it to 15.5% as persistent pressures from logistics, wage and energy costs continued despite increased raw food supply. Most recently, it raised the key policy rate to 16% in view of persistent underlying price pressures, second-round effects from supply shocks and higher medium-term inflation risks, after consumer inflation accelerated to 8.1% year on year in August, primarily on a greater-than-expected rise in fuel prices amid escalation in the Middle East and faster increases in administered tariffs due largely to Russia’s attacks on critical infrastructure. The increase aims to support the attractiveness of hryvnia assets, maintain FX market sustainability, keep inflation expectations in check and return inflation toward the 5% target, while the NBU said it stood ready to tighten further if risks intensified or consider easing if the security situation noticeably weakened consumer demand and the labor market.