April 23, 2018 / 10:00 AM / a year ago

UPDATE 1-Ukraine monetary policymakers say rate cut unlikely this year

(Adds quotes, details)

KIEV, April 23 (Reuters) - Ukraine’s central bank is unlikely to lower its key interest rate this year from the current level of 17 percent and may have to maintain a stricter policy for longer than previously expected, according to committee notes published on Monday.

Earlier in April, the bank kept rates on hold after four consecutive increases to rein in stubbornly high inflation linked to higher food and oil prices and to government-backed increases in workers’ wages and pensions.

Notes from the latest monetary policy committee meeting showed that the majority of members do not believe the main rate will be lowered this year.

“What’s more, there is a possibility that the central bank will have to maintain strict monetary conditions for longer than previously forecast,” the notes said, citing interest rate increases in the United States as a key factor.

On Friday, U.S. Federal Reserve Governor Lael Brainard said she expected gradual interest rate hikes to continue.

The Ukrainian central bank once again stressed the importance of Ukraine receiving long-delayed loans under a $17.5 billion programme from the International Monetary Fund.

Without further international financial assistance, the government will have to cut expenditure, it said. (Reporting by Natalia Zinets Writing by Alessandra Prentice; editing by Matthias Williams and Catherine Evans)

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