The continuation of Ukraine’s cooperation with the International Monetary Fund (IMF) removes the need to tighten monetary policy, at the same time, a noticeable slowdown in inflation is necessary to move to reduce the refinancing rate, deputy head of the central banker Oleh Churiy has said.
“If the reforms are implemented, cooperation with the IMF will continue, while inflation will decrease in accordance with our current forecast. We will have the opportunity for currency liberalization and maintaining the current refinancing rate at the current level,” he said at the joint conference of ICU and Bloomberg “Opportunity Knocks – Ukraine Local Bond Market Conference” in London.
The banker noted that the monetary committee at a meeting in May considered an alternative scenario for the development of events, without reforms and financial support from official creditors.
“If the situation develops according to this scenario, it will lead to increased risks for inflation and we will have to raise the refinancing rate,” Churiy said.
He added that the NBU in extreme cases may consider using other instruments, for example, currency restrictions, if it is required to maintain financial stability.
As reported, on June 7 the Verkhovna Rada passed the law on the High Anti-Corruption Court (presidential bill No. 7440), which is one of the key conditions for continuing cooperation with the IMF.
