Ukrainian PM stresses need to ease monetary policy

10:56, 28 November 2012
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Ukrainian Prime Minister Mykola Azarov said Tuesday his government supported easing monetary policy to boost economic growth, according to Xinhua.

"We have significant opportunities for monetary easing. To improve the performance of our businesses in the domestic market, we are developing a set of measures and implementing them practically to enhance the circulation of money," Azarov told a session of the Ukrainian Federation of Employers.

The possibility of the measures increasing inflation was a calculated risk in the current situation, Azarov said.

Consumer prices in the East European country fell 0.3 percent in the first 10 months of the year. However, the government retained its inflation forecast for 2012 at 7.9 percent.

Economists expect the National Bank of Ukraine (NBU) to step up its battle against deflation, probably by reducing the key interest rate by 0.25 percentage points to 7.025 percent in the near future.

Aiming to bolster the economy and withdraw an excessive amount of currency in circulation, Ukraine introduced regulations in mid-November obliging exporters to sell half their foreign currency earnings to the government.

Ukraine has also been mulling introduction of 15-percent tax on currency exchange next year.

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