On January 22, the decision to raise the key interest rate from 13.5% to 14.5% per annum was supported by seven out of the eleven members of the Monetary Policy Committee (MPC) of the National Bank of Ukraine, while three members favored 14%, and one member advocated for 15%, as stated in the discussion results published by the regulator on its website on Monday.
"Increasing the key interest rate by 1 percentage point (p.p.) will send a clear signal to economic agents: the NBU is prepared to act decisively, utilizing all available tools to curb inflationary pressure and bring inflation down to the target of 5% within an appropriate policy horizon. This will help stabilize expectations and reduce inflationary pressure," noted the position of the majority of the MPC.
In their view, this decision aligns with the NBU's previous statements regarding its intentions (forward guidance) and was not a surprise for experts and market participants, thus it will not be perceived by economic agents as an emergency measure and is unlikely to cause concern in the markets.