The Board of the National Bank of Ukraine (NBU) has decided to keep the key policy rate unchanged at 15% per annum, in line with market expectations, given the risks of rising inflationary pressure and deteriorating inflation expectations.

"The NBU has postponed the further easing of its interest rate policy in view of the risks of an increase in inflationary pressures and a deterioration in inflation expectations. This decision will support the attractiveness of hryvnia instruments, the sustainability of the FX market, and the controllability of expectations in order to ensure moderate inflation this year and bring it to its 5% target over the policy horizon," the regulator said in a press release on its website on Thursday.

"To safeguard the sustainability of the FX market and to keep inflation expectations and processes in check, the NBU has left its key policy rate unchanged, at 15%," the central bank added.

As reported, the National Bank lowered the key policy rate to 15% per annum at the end of January this year. Prior to that, it had held the rate at 15.5% for seven consecutive meetings starting in March 2025, after raising it three times beginning in mid-December 2024.

The regulator said that if risks to price dynamics persist, the NBU will refrain from easing its interest rate policy further. It also stands ready to raise the key policy rate and take additional measures if the risks increase.

The NBU recalled that After a long period of decreases, headline inflation accelerated slightly in February, to 7.6% y-o-y. At the same time, core inflation stood at 7.0% y-o-y. Prices for fuel, services, and raw foods grew somewhat faster than expected, whereas processed food prices rose more slowly, the regulator said.

At the same time, the NBU said that in the meantime, households’ inflation expectations deteriorated significantly – probably, on the back of the difficult situation in the energy sector at the start of the year and concurrent increases in the prices of some everyday consumer goods, such as fuel and raw foods.

"Further inflation trajectory may be higher than forecast, particularly as a result of an increase in energy prices due to the war in the Middle East," the statement said.

According to the release, the situation in the Ukrainian energy sector improved in the past weeks, which should dampen the price pressure. For its part, the NBU will maintain appropriate monetary conditions so as to preserve the attractiveness of hryvnia instruments and ensure the sustainability of the FX market. This, among other things, should contribute to calming down inflation expectations.

The central bank also said that uncertainty regarding future developments remains high, with risks related to escalating geopolitical confrontation globally having increased in recent months.

"If the war in the Middle East is prolonged, global energy prices will most likely deviate significantly from the NBU’s forecast trajectory. On the one hand, this would further push up inflationary pressure in Ukraine; on the other, it would bolster Russia’s capacity to sustain its full-scale war," the central bank said.

It added that other inflationary risks are also important. These include irregular and/or reduced international financing, the emergence of additional budgetary needs to support defense capabilities and reconstruction, and further escalation and the prolongation of external conflicts, which could, in particular, negatively impact support for Ukraine.

At present, the statement said, external assistance enables Ukraine to finance the budget deficit and keep international reserves high, which is important for maintaining FX market sustainability. Ukraine has received $5.5 billion in official financing since the start of the year. These inflows allowed the government to finance all critical budget expenditures and retain the financial cushion for covering future budgetary needs. The international reserves remained high and were close to $55 billion as of the end of February. Such level of reserves ensures the NBU’s high capacity to maintain the sustainability of the FX market.

The NBU said that in the past weeks, the U.S. dollar strengthened against the majority of currencies, including the hryvnia, primarily due to the increase in geopolitical uncertainty, which caused turbulence on global financial and commodity markets. At the same time, the exchange rate of the hryvnia against the euro and many other currencies of Ukraineэs main trading partners changed only slightly.

A summary of the discussion by Monetary Policy Committee members that preceded the approval of this decision will be published on 30 March 2026.

The next meeting of the NBU Board on monetary policy issues will be held on 30 April 2026.