top - of - the - line professionals continue to work at the nbu to promote the macroeconomic and financial stability of ukraine and the institutional capacity of its central bank. however, it is crucial that their work goes on uninterrupted. it is imperative that the president, government, and political forces finally begin to work effectively with the central bank. after all, the nbu has made tremendous efforts to speed up the development of the economy and financial markets and to advance the welfare of all ukrainians, and can do a lot more if not interfered with. let me focus only on what has been accomplished during my term as governor since march 2018. we have finally curbed inflation. every year, we broke our own records in terms of bringing inflation closer to a level that is optimal for the economy. in 2018, inflation stood at 9. 8 %. in 2019, it was down to 4. 1 %. through its consistent monetary policy, the nbu has 1 / 4 bis central bankers'speeches achieved an inflation target of 5 % ± 1 pp sooner than expected, and inflation has since remained low. our ability to be consistent in maintaining price stability in the face of political cycles was widely recognized by the international community last year, when the nbu received the globalmarkets award. for the first time since ukraine gained independence, the key policy rate has been reduced to 6 %. two years ago, when the parliament appointed me to lead the nbu, the key policy rate stood at 17 %. today the central bank pursues a stimulating monetary policy aimed at reviving economic growth. but we have not stopped there. we have introduced completely new tools to support the economy. those include refinancing loans for banks for up to five years, an interest rate swap for banks, and an fx swap facility with international institutions. we have made single - digit loan rates a reality. yes, it will be some time before low inflation and the low key policy rate have their full impact on the cost of debt. but it will definitely happen. of course, if creditors ’ rights were better protected, it would happen sooner, but this is beyond the nbu ’ s purview. we have strictly adhered to a market - driven, flexible exchange rate regime, while at the same time ensuring that the hryvnia is stable. moreover, we have worked to develop the fx market. as a result, today the exchange rate is set transparently on leading international

platforms, where all players participate anonymously. we have come under criticism for strengthening the hryvnia last year. those criticizing us said that the nbu should have been more active in the fx market, when in fact the nbu was active enough that last year alone it added to international reserves a record usd 8 billion, having purchased it in the fx market. yes, if we had bought more dollars, we would not have heard complaints from exporters. but we would have heard complaints from importers and, most important, from ordinary people who earn and spend hryvnias. therefore, we kept the balance and, as befits a central bank, pursued a neutral policy, rather than playing into the hands of individual market participants. another category in which the nbu set a new record every year is international reserves. this time we hit a new high. while i was in office, ukraine ’ s financial safety cushion increased by usd 10 billion, from usd 18 to usd 28 billion. last year, ukraine was popular among international investors. although this provided good financial support to the government, this was used to criticize the central bank. at the same time, our critics ignored the fact that international reserves grew, not least due to foreign exchange inflows from nonresidents. this enabled us to overcome, reasonably painlessly and quickly, the fx market turbulence in march caused by the coronavirus pandemic. in 2019, the nbu embarked on a large - scale liberalization of the fx market. this was a truly revolutionary event, for which ukrainian businesses and households had been waiting for a quarter of a century. the nbu has already lifted about 40 fx restrictions, which had for years hampered business development and investment inflows, while also limiting the rights of ukrainians to freely engage in fx transactions. the banking system is healthy, highly liquid, and profitable. since november 2018, not a single bank has been removed from the market. the general public knows who owns each and every bank. this is reviving confidence in the banking sector. this is evidenced by deposit growth – since the start of 2018 hryvnia household deposits have risen by one - andhalf times. moreover, thanks to years of continuous preparation of the banks for potential problems, the banking system entered the coronavirus crisis stronger than ever. it is now an outpost of financial stability and a lifesaver for the economy. 2 / 4 bis central bankers'speeches cashless