NBU keeps the key rate at 15%, but worsens inflation and Ukraine’s GDP forecasts

NBU keeps the key rate at 15%, but worsens inflation and Ukraine’s GDP forecasts

The National Bank left the rate unchanged but worsened forecasts for inflation and GDP.

On April 30, the National Bank of Ukraine decided to keep the key rate at 15%, explaining this by devaluation expectations and acceleration of inflation due to rising fuel prices.

«The Board of the National Bank decided to keep the key rate at 15% to maintain the attractiveness of hryvnia assets, stability of the foreign exchange market, and controllability of inflation expectations amid growing price pressure. Pressure on prices has increased due to problems in the energy sector after Russian attacks, a sharp rise in fuel prices amid the conflict in the Middle East, consequences of previous hryvnia weakening periods, as well as faster-than-forecast wage growth», — said NBU Governor Andriy Pysny.

He also noted that the National Bank has revised downward the GDP growth forecast for Ukraine in 2026 — from 1.8% to 1.3%. At the same time, economic growth is expected to accelerate in 2027–2028 to 2.8–3.7%.

In addition, the NBU raised the inflation forecast for the end of 2026 from 7.5% to 9.4%.

At the same time, Pysny expects $53 billion in international aid to Ukraine in 2026, with a subsequent decrease: to $42 billion in 2027 and to $22 billion in 2028. He also highlighted key risks to the Ukrainian economy:

• Emergence of additional budgetary needs for defense and recovery.

• Disruptions in the regularity or volumes of external financing.

• Intensification of negative migration and growth of labor shortage in the labor market.

«The development of events in the Middle East will have a significant impact. The forecast takes into account the real consequences and effects of a short-term conflict. But if the confrontation drags on, world energy prices will turn out higher than expected, and demand for Ukrainian exports — lower. This will intensify inflation in Ukraine and slow economic activity. Escalation of geopolitical conflicts could also undermine international support», — emphasized Andriy Pysny.

He confirmed pressure on the hryvnia but assured that the National Bank would soften its devaluation.

«At the beginning of the year, the pressure on the hryvnia exchange rate increased, primarily due to the consequences of Russian air strikes in winter and escalation in the Middle East in spring. This led to an increase in imports of energy resources and equipment, as well as deterioration of exchange rate expectations», — explained Pysny.