Policy rate rises to 16.5 percent as inflation pressures build
National Bank of Ukraine (NBU) Governor Andriy Pyshnyy said the Board raised its policy rate by 50 basis points to 16.5 percent. The decision supports hryvnia savings and foreign exchange stability as inflation rises and economic activity weakens.
Higher prices, weaker output
September headline inflation reached 10.0 percent and core inflation 8.8 percent.
Russian attacks on production and logistics, Middle East war-related fuel costs and worsening expectations drove price pressures.
The NBU forecasts inflation of 12.5 percent in 2026, 7.3 percent in 2027 and its 5 percent target in 2028.
Aerial attacks alone add around 0.7 percentage points to annual inflation.
Real GDP fell 0.5 percent in Q3; the NBU forecasts a 0.4 percent contraction in 2026, with attacks subtracting 1.9 percentage points.
Growth projections of 0.4 percent in 2027 and 2.2 percent in 2028 depend on improved logistics from mid-2027 and easing security risks.
Lower oil prices, monetary measures and weaker demand underpin projected disinflation.
Aid anchors the financing outlook
Delayed reforms reduced Q3 aid; October laws unblock European Union and International Monetary Fund financing.
Budget support assumptions are $50 billion in 2026 and $52 billion in 2027, plus Ukraine Support Loan defense funding above $32 billion and of $37 billion, respectively.
Reserves stay above $62 billion in 2026–2027.
September net hryvnia corporate loans grew over 32 percent and retail loans over 38 percent.
Four regulatory packages support defense, energy, agriculture and trade.
Deposit repricing has spread from small to large banks.
A conditional rate hold
The NBU projects a rate hold until Q2 2027, not an unconditional commitment.
It will weigh persistent price pressures against weaker activity as Russian attacks damage supply and restrain demand.
Financing delays, labor shortages and prolonged Middle East hostilities remain risks in its assessment.