KIEV: Ukraine's central bank lowered its main interest rate to 16.5 percent on Thursday from 18 percent, its third consecutive rate cut following a sharp slowdown in inflation.
Consumer price rises slowed to 7.5 percent in May and earlier this month central bank chief Valeriia Gontareva said Ukraine's war-torn economy had emerged from the worst of crisis that saw inflation hit over 60 percent in 2015.
The bank said it plans to ease policy further provided this does not negatively affect inflation targets, warning that price stability hinged on a successful second review of a $17.5 billion bailout programme from the International Monetary Fund.
"Thus, government commitment to continue urgent reforms is important, as is support for them from the Verkhovna Rada (parliament)," the central bank said in a statement.
The central bank expects the International Monetary Fund's board to decide in July to disburse a third tranche of loans amounting to $1 billion, Gontareva said at a briefing following the announcement of the latest rate cut.
She said foreign currency reserves currently stood at $13.6 billion, enough to cover 3.5 months of imports.
The central bank kept inflation targets unchanged at 12 percent in 2016 and 8 percent in 2017.
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