Dragon Capital predicts a slowdown in economic growth next year along with a slowdown in price growth.
This is announced in the company's statement, Ukrainian News Agency reports.
"We forecast a further slowdown in real GDP growth in 2026 to 1.5% y/y in the "protracted war" scenario. The military-industrial complex sector will remain the driver of economic growth, provided that its financing from the budget and partners increases, in particular within the framework of the "Danish model". Thus, according to our estimates, the sector's production could approach USD 20 billion in 2026, having more than doubled from USD 9 billion in 2024. The economy will also be supported by stable consumer demand, which will be fueled by growth in nominal wages and slowing inflation. Economic development will be restrained by production losses caused by the war and a shortage of labor," the company noted.
However, Dragon Capital expects real GDP growth to accelerate in the second half of this year to reach 2.0% for the year, driven by the absence of significant power shortages and critical infrastructure damage, although a shortage of skilled labor will continue to constrain the economy's potential.
If a sustainable ceasefire is achieved in early 2026, GDP growth could accelerate to 5.0% y/y, driven by rising consumption and renewed investment activity amid reduced security risks, the start of reconstruction, and the partial return of refugees.
"We expect annual inflation to continue to decline next year amid moderate fundamental pressure and provided there are no shocks to the supply of agricultural goods due to fluctuations in weather conditions and harvests. Therefore, we forecast a slowdown in consumer inflation to 5.3% y/y by the end of 2026 in the "protracted war" scenario, and to 7.5% in the "sustainable truce" scenario. The higher inflation forecast in the second scenario reflects stronger fundamental pressure against the backdrop of stronger domestic demand and the expected increase in utility tariffs," the company added.
As Ukrainian News Agency earlier reported, Dragon Capital Company in May forecast a decline in inflation in the summer of this year.
In addition, Dragon Capital expected the National Bank of Ukraine to return to a controlled and gradual weakening of the hryvnia in the second half of the year.
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