Ukraine central bank sees inflation at 10% by end-2026

The NBU said annual inflation accelerated to 7.7% in July after a temporary slowdown in late spring and early summer, when fresh produce from the new harvest helped ease pressure on food prices. It now sees inflation rising further to 10% at the end of 2026, then easing to 6.9% in 2027 and 5% in 2028.

The central bank blamed a mix of forces for the pickup: higher electricity prices after Russian strikes, more expensive fuel tied to the Middle East conflict, higher business labor costs, a weaker hryvnia earlier this year and strong consumer demand supported by wage growth and elevated budget spending.

For investors, the message is that Ukraine is still in a high-inflation, high-rate environment where policy support remains focused on currency stability rather than rapid easing. The NBU said it will stay active in the foreign-exchange market to limit excessive moves and keep interest rates high enough to support demand for hryvnia savings.

That stance should help anchor the currency and limit imported inflation, but it also keeps borrowing costs elevated for companies and consumers, with implications for credit growth, domestic demand and corporate margins.

The bank said inflation should begin to cool only gradually as budget spending contracts, the energy sector recovers and harvests expand food supply. The key risk for markets remains whether war-related damage, energy costs and exchange-rate pressure keep inflation hotter for longer than the NBU expects.