The NBU forecasts a further decline in inflation in 2026: what is happening with prices
12 January 23:00
The National Bank of Ukraine commented on the State Statistics Service’s data on inflation in December 2025, which slowed to 8.0% year-on-year. The regulator noted that the actual figures were lower than its forecasts published in the October Inflation Report. This was reported by "Komersant Ukrainian" with reference to the NBU.
The NBU notes that actual price dynamics were more subdued than expected, and key inflation factors are gradually weakening. This creates the basis for a further decline in inflation in 2026.
Why inflation slowed down in 2025
The impact of harvests and currency
According to the NBU’s assessment, the better-than-expected indicators are primarily related to higher harvests, which have restrained food price growth.
The stable situation on the currency market also had a positive impact, reducing pressure on the prices of imported goods.
Core inflation decreased
Core inflation (excluding administratively regulated prices and seasonal factors) fell to 8% in December, compared to 9.3% in November. This is lower not only than the NBU’s forecasts, but also than the 2024 figure (12%).
How prices changed in 2025: a brief overview by category
Food
In December, the annual growth in prices for raw products slowed down compared to November.
The decline in prices for vegetables used in borscht deepened due to difficulties in storing fairly high yields.
The rise in pork prices slowed due to increased imports, and milk prices slowed due to lower raw milk prices amid the accumulation of excess stocks due to falling world prices. The suspension of dairy exports to the EU in December due to changes in quota licensing requirements also had a certain impact.
The growth in prices for processed food products slowed to 12.1% y/y, in particular due to a slowdown in the growth of prices for butter, cheese, and fermented milk products.
Non-food products
In December, the growth of prices for non-food products paused (0.0% y/y), in particular due to the stable situation on the currency market.
Prices for clothing and footwear continued to decline, while price growth for other non-food products continued to slow down.
Services
Inflation in services slowed to 12.3% y/y in December amid a gradual easing of pressure from the labor market.
In particular, the growth rate of prices for insurance and financial services, cafes and fast food outlets, outpatient services, etc. declined.
Administratively regulated prices
The slowdown in administrative inflation in December was due to a further decline in the rate of increase in the prices of bread, pharmaceuticals, alcoholic beverages, and a moderate decline in the rate of increase in the prices of tobacco products.
Fuel
Fuel inflation stood at 6.4% at the end of 2025.
The acceleration in fuel price growth in December was due to a further increase in the price of gasoline and diesel fuel as a result of logistics problems, deteriorating weather conditions, and increased demand amid power outages.
An additional factor was the rise in liquefied gas prices caused by significant delays in deliveries at the beginning of the month.
What to expect from inflation in 2026
The National Bank of Ukraine forecasts a further slowdown in inflation in 2026. Key factors:
- a gradual reduction in labor market imbalances
- moderate external price pressure
- the impact of the NBU’s monetary policy instruments.
The regulator emphasizes that in the absence of new large-scale shocks (energy or financial), inflation should remain under control.
