On April 30, Ukraine’s National Bank announced it would keep its key interest rate at 15%. This decision aims to support the attractiveness of the national currency, the hryvnia, stabilize the foreign exchange market, and manage inflation expectations as price pressures intensify.
The central bank stated, “An appropriate level of monetary conditions will facilitate a return of inflation to a sustainable decline towards the target of 5% in the policy horizon. Should risks to price dynamics increase, the NBU will be ready to implement additional measures to curb inflationary pressure.” This reflects the bank’s proactive stance in addressing economic challenges.
Recent observations indicate that inflation, which had been on a downward trend, is now rising, primarily due to increasing energy prices. The NBU noted that inflation had been steadily decreasing from June 2025 until January 2026, but has since begun to climb again.
“Price pressure has intensified due to the challenging situation in the energy sector following Russian attacks, sharp increases in fuel prices amid the ongoing conflict in the Middle East, the effects of prior hryvnia depreciation, and a faster-than-expected rise in wages,” the NBU explained.
In March, year-on-year inflation accelerated to 7.9%, with core inflation reaching 7.1%. Both figures surpassed the NBU’s earlier forecasts outlined in its January 2026 inflation report. The upward trend in inflation continued into April.
The central bank anticipates that inflation will remain around its current level in the coming months but is expected to accelerate in the second half of the year, potentially reaching 9.4% by year-end. This projection is based on increased production costs, particularly due to rising energy prices.
However, the NBU predicts that inflation will return to a downward trajectory by 2027. Contributing factors may include the waning effects of high fuel prices, a reduction in external price pressures, gradual increases in harvest yields, and improvements in the energy sector.
According to the NBU’s assessment, these elements, combined with its monetary policy, could lead inflation to slow to 6.5% by the end of 2027 and reach the target of 5% in 2028.
In March, the NBU reported that inflation had risen to 13.4% year-on-year, with prices increasing by 0.8% on a monthly basis.
Ukraine's National Bank has decided to maintain its interest rate at 15% in response to rising inflation driven by energy costs and wage increases. The bank anticipates inflation will peak later this year but expects a return to lower rates by 2027, contingent on various economic factors.