Main Article Content



Introduction. Today, an important role belongs to prudent state policies in the field of economy and promptness in making appropriate decisions regarding the implementation of a system of instruments, methods, and forms of state influence on these processes. The monetary factor, including the central bank's policy to increase the level of discounting, fix the exchange rate, and make further adjustments with other measures to reduce issue funding, has allowed maintaining financial stability despite the obvious impact of non-monetary factors on inflation in this situation. Therefore, it is necessary to investigate the components of the concepts of financial and monetary stability and justify the use of monetary policy tools, particularly the discount rate, in conditions of economic instability caused by crisis phenomena in the country's economy.

The purpose of the article is to determine the place and role of the discount rate in ensuring monetary stability in the context of financial stability.

Results. The study analyzes the content of the concepts of monetary and financial stability, indicating their determinants and the methodology of formation. It determines the role of the discount rate in ensuring monetary stability. It emphasizes the characteristics of financial stability, which acts as a set of states, a certain range, or continuum, endowed with dynamic characteristics and a lack of linear dependence between different elements of the financial system. The article defines the concept of monetary policy and monetary stability in relation to the concepts of financial and price stability. It highlights the peculiarities of interpreting the content of the concepts of internal and external monetary stability in the context of the influence of external and internal factors that have monetary and non-monetary natures. It determines the economic rate of the discount rate, the principles of its action, the direct economic effects of its application, the factors that affect the change of its level, and the features of signal transmission through channels of the transmission mechanism.

Originality. The article introduces new definitions for the concepts of monetary policy, which is a comprehensively organized regulatory mechanism with a three-syllable structure (emission-monetary, credit, and currency) and a mono-direction aimed at maintaining price stability; monetary stability, which acts as a synonym for price stability and, in an extended interpretation, is determined not only by the stability of the internal price level but also by relative external stability and strong financial conditions. It defines the methodology for forming economic categories of financial and monetary stability and the discount rate, which involves the combination of general scientific methods of cognition, certain techniques of mathematical calculation and forecasting, and a combination of a systemic complex approach and a global vision of the situation to evaluate its stability and prospects of economic development, as well as methods of economic development. These methods include abstract-theoretical evaluation, system analysis, and a functional approach, based on the principles of rationalism, systematic analysis, the interdependence of phenomena and processes, and causal and structural-functional relationships. The article emphasizes the need to comply with the principle of sufficient reason for monetary (especially in terms of changes in the key rate) and fiscal decisions, taking into account the significant impact of numerous non-monetary inflationary factors, and the timely and urgent application of relevant policies with preventive, corrective, and restorative measures.

Conclusions. The introduction of the inflation targeting regime in Ukraine has strengthened the role and value of the discount rate as a key monetary policy tool, the change of which affects the country's financial stability. Under the conditions of intensified interest policy, the discount rate influences several processes, including short-term interest rates on the interbank market and other indicators of the financial market (funding, income, etc.), inflation, exchange rate dynamics, and overall economic growth. In the current conditions of Ukraine, as an open economy, external challenges and consequences of globalization processes play a significant role, although this does not diminish the importance of methodological principles within the economic system, such as systematic economic processes, transparency of activity, efficiency, and coordination of financial policies that ensure financial stability in the country.

Article Details



Billi R. М., Vredin A. (2014). Monetary policy and financial stability – a simple story. Sveriges Riksbank Economic Review. 2, 7-22. Retrieved from: (Аccessed: 02.04.2023)

Borio C., Toniolo G. (2006). One hundred and thirty years of central bank cooperation: a BIS perspective. BIS Working Papers, 197, 46.

Minsky H. P. (1992). The Financial Instability Hypothesis. The Jerome Levy Economics Institute of Bard College. Working Paper, 74, 1-10. Retrieved from: https://www.levyinstitute. (Аccessed: 01.04.2023).

Mishkin F. S. (1997). The Causes and Propagation of Financial Instability: Lessons for Policymakers. Maintaining Financial Stability in a Global Economy: Jackson Hole Economic Policy Symposium. 55-96. Retrieved from: ‘(Аccessed: 01.04.2023)

Padoa-Schioppa Т. (2002). Central banks and financial stabiilty: exploring a land in between. The transformation of the European financial system: Second ECB Central Banking Conference, 46. Retrieved from: (Аccessed: 02.04.2023).

Friedman M., A Monetary and Fiscal Framework for Economic Stability. The American Economic Review, 1948. Vol. 38, No 3, P. 245-264.

Schinasi G. J. (2004). Defining Financial Stability. IMF Working Paper, 04 (187), 18. Retrieved from: (Аccessed: 02.04.2023)

Zholud O., Lepushynskyi V., Nikolaychuk S. The Effectiveness of the Monetary Transmission Mechanism in Ukraine since the Transition to Inflation Targeting. Visnyk of the National Bank of Ukraine, 2019, No. 247. С.20 - 40. (in Ukr.).

Petryk О. (2009). What should be the organizational structure of banking supervision in Ukraine? Visnyk Natsionalnoho banku Ukrainy (Bulletin of the NBU), 11, 3–6. (in Ukr.).

Lepushynskyi V. (2015). A strategic document on monetary policy in the context of the introduction of inflation targeting in Ukraine. Visnyk Natsionalnoho banku Ukrainy (Bulletin of the NBU), 25-40. (in Ukr.).

Yurchyshyn V. (2022). Economic features of autumn 2022. Razumkov Centre. Retrieved from: (in Ukr.).

Psyk B. I. (2013). Financial stability: essence and features of manifestation. Visnyk SevNTU (Bulletin of SevNTU), 138, 91-96. (in Ukr.).

National Bank of Ukraine (2020). Macroprudential Policy Strategy of the National Bank of Ukraine. Retrieved from: (Аccessed: 01.04.2023)

Vovchenko O.S. & Egorycheva S.B. (2021). Financial stability of banks in a dynamic macroeconomic environment. Poltava: PUET, 233. (in Ukr.).

Stefaniak S. (2018). Defining «financial stability». Polish Review of International and European Law, 7, 1, 9-38.

Monetary stability, financial stability and the business cycle: five views. (2003). Bank for International Settlements Papers, 18, 31. Retrieved from: (Аccessed: 02.04.2023)

Verkhovna Rada of Ukraine (1999). «On the National Bank of Ukraine», Law of Ukraine No 679-ХІV dated revision on May 6, 2023. Retrieved from: (дата звернення: 02.04.2023)

Central bank and monetary policy (2005). In A. Moroz, M. Pukhovkina (Ed.). Kyiv: KNEU, 556 (in Ukr.)

Cottarelli C., Baliño T. J. T. (1994). Frameworks for monetary stability Policy: Issues and Country Experiences. The sixth seminar on central banking. Washington, 755. DOI:

Tkachuk E. V., Nikiforov. P. O. (2022). Fiscal and monetary policy: macroeconomic analysis and institutional environment. Chernivtsi: Chernivtsi national Univ. named after Yu. Fedkovicha, 240. (in Ukr.).