All members of the Monetary Policy Committee (MPC) of the National Bank of Ukraine (NBU) supported maintaining the National Bank of Ukraine (NBU) key policy rate at the level of 25% at the Committee meeting on December 7, according to the NBU website on Monday.

"Considering the balance of risks, the MPC members, for the fourth time running, unanimously spoke in favor of keeping the key policy rate at 25%. Keeping the key policy rate at 25% over the past six months, along with the pursuit of a fixed exchange rate regime and measures to regulate the FX market, has played an important role in maintaining macrofinancial stability as the full-scale war wears on, all discussants agreed," the NBU said in the press release.

As several participants in the discussion noted at once, the decision to keep the key policy rate looks the most balanced.

The decrease in some pro-inflationary risks since the previous meeting was offset by new sources of inflationary pressure.

According to market surveys, maintaining the rate in December is an expected decision for financial market participants, which means that such a move will help strengthen confidence in monetary policy.

The committee noted that any unexpected move to reduce the refinancing rate, even a small one, could provoke worsening expectations in the current environment and increase uncertainty.

At the same time, it is still difficult to justify an increase in the key policy rate, since this may lead to an excessive strengthening of monetary conditions.