The activities of the NBU are aimed at fulfilling the functions and tasks identified by the Constitution of Ukraine and the laws of Ukraine.
The Law of Ukraine On the National Bank of Ukraine identifies a priority list of objectives the NBU must meet to fulfill its main function, which is to ensure the stability of Ukraine’s currency. Under the law, the NBU’s monetary policy must prioritize ensuring and maintaining price stability.
In implementing its monetary policy, the NBU seeks to gradually reduce inflation and meet the medium-term inflation target of 5% ± 1 percentage point.
The medium-term inflation target is stipulated in the Monetary Policy Strategy of the NBU and may only be revised downwards as Ukraine makes progress in terms of economic development. The annual Monetary Policy Guidelines describe the specifics of using monetary policy tools, and the macroeconomic context in which monetary policy is implemented.
The NBU Board’s decisions on monetary policy issues and inflation reports provide information on the expected development of inflation processes and the period during which inflation will fall within the target range.
For the economy to operate with success, central banks should pay attention not only to maintaining price stability, but also to promoting financial stability. The law identifies the promotion of financial stability as the NBU’s second priority.
In the long run, the stability of the domestic currency is impossible without ensuring sustainable economic development. Thus, the NBU’s third priority is to facilitate sustainable economic growth and to support the implementation of the Ukrainian government’s economic policy.