This is the inertia coefficient attached to the lagged interest rate dependent variable, which in these rules moderates the pace of reaction of the policy rate to its fundamental determinants.
At the same time, the inflation trend will be reversed gradually as new harvest supplies come to the market, the effect of a low comparison base wanes for some products, and the NBU raises its key policy rate. Inflation will thus decelerate at the end of the year and will settle within the 5% ± 1 pp target range in H1 2022.