The severe fallout may indicate a larger potential gain than I had anticipated to leaning against excess exuberance in asset markets. However, realizing that potential rests on meeting my two other conditions as well – the timely identification of the bubble, and the ability of a central bank to materially influence the trajectory of the speculative component of asset prices.
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.