Inflation will accelerate this year, but will return to decline in following years - NBU

The National Bank has announced that inflation will accelerate this year but will begin to decline in the coming years.

This is stated in a report by the NBU, according to the Ukrainian News agency.

The National Bank’s April forecast takes into account the consequences of damage to the energy sector and the impact of the war in the Middle East. Inflation will accelerate to 9.4% in 2026 and begin to decline starting next year: to 6.5% by the end of 2027 and to 5% in 2028. Economic recovery this year will slow to 1.3%, but will accelerate in subsequent years to 2.8–3.7% annually.

The NBU’s baseline forecast scenario is based on the assumption of a gradual normalization of conditions for Ukraine’s economic functioning. It takes into account the current consequences of shelling and destruction, as well as sufficient external financing over the forecast horizon. The forecast also assumes that the acute phase of the war in the Middle East will be temporary and, accordingly, that oil prices will gradually decline starting in the second half of 2026, although they will remain fairly high.

After a prolonged period of decline, inflation began to rise and accelerated to 7.9% by the end of March. According to NBU estimates, this trend continued in April. In the coming months, inflation will remain near current levels, but will accelerate in the second half of the year (to 9.4% by year-end) due to increased pressure on enterprises’ production costs, particularly from the direct and secondary effects of rising energy prices, the weakening of the hryvnia exchange rate driven by market factors in previous periods, and further wage increases.

Inflation will return to a steady downward trajectory as early as the beginning of 2027 and will decline to 6.5% by the end of the year, and to the NBU’s 5% target in 2028. This slowdown will occur across a wide range of goods and services due to the fading effects of high fuel prices, easing external price pressures, a gradual increase in crop yields, the normalization of the energy sector, and the NBU’s monetary policy measures.

The NBU’s forecast projects that the policy rate will remain at 15% until the second quarter of 2027. This rate level will sustain interest in hryvnia savings, which will curb inflation both by limiting pressure on consumer demand and the foreign exchange market and by keeping inflation expectations under control. Should risks to price dynamics intensify, the NBU will be prepared to take additional measures to curb inflation, including raising the discount rate.

As the Ukrainian News agency earlier reported, consumer prices rose by 1.4% in April 2026.