The NBU kept the key rate at 15.5%: how will this affect the economy

The National Bank’s Board kept the key rate at 15.5%

The NBU press service reported this.

It is noted that this will allow us to continue to maintain appropriate monetary conditions for the stability of the foreign exchange market, controllability of expectations and bringing inflation to the target of 5%.

“The National Bank is ready to respond flexibly to changes in the distribution of risks,” the statement said.

What is the discount rate?

The discount rate is the percentage at which a country’s central bank lends to commercial banks. If the rate is high, loans to banks become more expensive, and therefore, interest rates on loans to individuals also rise. This can hurt consumer spending. If the rate is low, loans become cheaper, which stimulates the economy.

How does it affect purchasing power?

The discount rate affects purchasing power due to the availability of money. When the rate is high, loans become more expensive, people borrow and sell less, which reduces the purchase profitability. When the rate is low, money remains available, there are more purchases, therefore, purchasing power increases.

It should be noted that the National Bank raised the key rate to 10% in January 2022. Since June 2022, the key rate had to be raised from 10 to 25%. It remained at this level for a year: on July 27, 2023, the rate decreased to 22% and then gradually decreased. Since December 2024, in response to the development of inflationary processes, the National Bank began to increase the rate to 15.5 in March 2025.