NBU reports increase in “minimum wage”

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This increase will affect other macroeconomic parameters

The NBU spoke about the increase in the minimum wage. Photo: kolobok.ua

A significant increase in the minimum wage will affect inflation, unemployment, discount rates, as well as indicators of Ukraine’s budget. It was announced by Ukraine Dmitry Sologub, deputy head of the National Bank reports Interfax

“If we simulate the situation and the minimum wage will increase, and significantly, it will affect macroeconomic indicators, it will affect budget indicators, inflation, unemployment and accordingly, NBU’s response in terms of interest rates . ” On July 23, during a press briefing by the NBU.

Sologub specified that if the minimum wage remains at the same level (UAH 4.723 thousand), then inflation would be in the target range (4-6%).

He also mentioned that in its original macro forecast, the central bank’s board did not change previous assumptions about the development of the minimum wage, as it had not seen plans to raise the indicator “on paper”.

“As far as we know, the discussion is going on. Ukraine had the experience of 2017, when the increase in the minimum wage affected the state budget deficit, monetary policy, inflation, and so on. He said, you have to understand this It is needed that this is only part of the equation – if you increase the minimum wage, it also changes other macroeconomic parameters.

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Earlier we wrote that the President’s Office has published a new program to increase the minimum wage in Ukraine. Volodymyr Zelensky directed the Cabinet of Ministers to increase the “minimum wage”, although the 2020 state budget does not provide for it.

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