NBU publishes three-phase road map for switching to inflation targeting
The National Bank of Ukraine (NBU) has published a three-phase road map for switching to inflation targeting.
According to the presentation posted on the regulator's website, the first phase provides for the quick disinflation: inflation is to decrease to 12% by late 2016 with 3% deviation. The second phase envisages one-digit inflation figures: inflation is to decrease to 8% by late 2017 with 2% deviation and by late 2018 – to 6% with 2% deviation. The third phase is maintenance of inflation at a 5% level with 1% deviation in the long-term outlook starting from late 2019.
According to the road map, the development of the interbank credit market will continue: the liquidity and derivative market development forecasts will be published. Administrative restrictions will be revoked to improve the currency market. Currency regulation will be liberalized and hedging tools will be promoted.
The interest policy that meets inflation targets will be conducted to achieve goals of curbing inflation to 12% by late 2016 and 8% by late 2017.
