The National Bank of Ukraine (NBU) and the International Monetary Fund (IMF) have begun joint work on a new cooperation program, the NBU press service said on Facebook. According to the report, on September 12 the first meeting of the NBU board with the IMF mission, which arrived in Ukraine, took place.
It was attended by NBU Governor Yakiv Smolii, his first deputy Kateryna Rozhkova and deputy Oleg Churiy, as well as representatives of the IMF mission led by Ron van Rooden.
During the meeting, Smolii emphasized that cooperation with the IMF is extremely important to support macro-financial stability in Ukraine, primarily because it is the key to further reforms in the country, without which a long-term growth of the Ukrainian economy is impossible. Also, cooperation with the IMF provides Ukraine with access to official and private financing.
IMF representatives expressed their intention to continue a constructive dialogue on a new cooperation program, the report said.
The National Bank of Ukraine has decided from September 6 to lower the refinancing rate to 16.5% per annum from 17% per annum, at which it has been since July 19 of this year.
“The National Bank continues the cycle of easing monetary policy, as it expects inflation to slow to the target of 5%,” the central bank said.
The NBU board noted that internal political risks to reduce inflation to the target weakened with the beginning of work of the Verkhovna Rada of the new convocation and the formation of a new government. According to the regulator, this opens up an opportunity to intensify negotiations with the International Monetary Fund on a new cooperation program.
At the same time, the central bank pointed to the persistence of both internal threats to financial stability (lawsuits around the nationalization of PrivatBank) and external threats – the termination of gas transit from Russia from the beginning of 2020, the intensification of trade wars and turbulence in the global financial markets, the escalation of the military conflict and new trade restrictions of the Russian Federation.
As reported, on April 26, the NBU lowered the refinancing rate to 17.5% per annum from the level of 18% per annum, at which it had been kept since the beginning of September.
