OREANDA-NEWS. On 24 February 2009 was announced, that the NBU Council announced the new principles of the monetary policy in 2009. The NBU did not state the boundaries of the exchange rate, meaning that it will not further support the stability of the exchange rate. At the same time the Council forecasted that the monetary base will grow by not more than 6% in 2009 (UAH 11bn), while the money supply will increase by less than 8% (UAH 41bn). Additionally the Council started to design the resolution that will abolish the moratorium on premature deposit withdrawals.

Millennium Capital sees the news to be MIXED. On the one hand, limiting of the monetary base and money supply growths will restrict the inflation in 2009, which is positive sign against the background inflationary nature of hryvnia devaluation. On the other hand, Millennium Capital expects that the NBU’s forecast will hardly be realized, since a mere recapitalization of the commercial banks will result in around UAH 44bn of expenditures from the State Budget in 2009, which exceeds the predicted amount of monetary base growth. Moreover, the dismissal of the deposits moratorium may lead to the increase of the cash amount, which also affects to the monetary base growth. Overall, adopted principles seem to be aggressive and allow free devaluation, deterioration in the banks’ assets and thus the bankruptcies of the weakest banks.

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