Ukraine to lose 0.4% of GDP in 2026 due to Russian strikes on energy infrastructure, National Bank says

The National Bank of Ukraine (NBU) has revised down its 2026 GDP growth forecast from 2.0% to 1.8%, citing the impact of Russian attacks on the energy sector.

Source: Andrii Pyshnyi, Governor of Ukraine's National Bank, at a press briefing on the NBU Board's monetary policy decisions

Details: The Bank said the electricity deficit rose to 7% in the fourth quarter of last year and is expected to stand at 6% in 2026, up from a previously projected 3%.

The central bank said Russian strikes on the energy sector have widened the electricity deficit, cutting projected 2026 GDP growth by 0.4 percentage points. Absent the attacks, growth would have reached 2.2%.

"The NBU has slightly lowered its forecast for real GDP growth in 2026 to 1.8% due to damaged logistics and a larger-than-expected electricity deficit in recent months," Pyshnyi said.

He added that the difficult situation in the energy sector will continue to constrain business activity for the foreseeable future.

Meanwhile, the NBU expects gradual improvements in the energy sector, continued infrastructure recovery and higher private investment to help accelerate economic growth to around 3-4% in 2027-2028.

Background:

• The NBU has lowered its 2026 inflation forecast, citing the impact of attacks on the energy sector.
• The National Bank has cut its key policy rate from 15.5% to 15% per annum, the first reduction in a year and a half.

Support Ukrainska Pravda on Patreon!