The Board of the National Bank of Ukraine (NBU) has raised its key policy rate by 0.5 percentage points to 16% per annum.
The decision was driven by persistent underlying price pressures and increased medium-term inflation risks, the central bank said.
The NBU noted that consumer inflation accelerated to 8.1% year-on-year in August, slightly exceeding the trajectory projected in its July forecast. The regulator attributed this primarily to a stronger-than-expected rise in fuel prices following the escalation of the war in the Middle East, as well as faster increases in certain regulated tariffs due to the consequences of Russian attacks on critical infrastructure.
The NBU expects inflation to remain somewhat higher than previously forecast in the coming months, but believes it will return to a downward trajectory in 2027.
At the same time, the central bank has downgraded its estimate for Ukraine’s economic growth.
“In July, we forecast GDP growth of 1.8% in 2026. However, the situation is dynamic. We can now say that this estimate has shifted to around 1.1–1.2%,” NBU Deputy Governor Volodymyr Lepushynskyi said at a briefing.
He attributed the downgrade to additional damage to industry and trade caused by Russian attacks, as well as deteriorating business expectations.
“However, this is certainly not the final figure. As I have said, the situation is dynamic, and by the end of the forecasting cycle we may see different figures,” Lepushynskyi said.
