Digests • 10 September 2026
On 17 August, the government of Ukraine presented its action programme for 2026–2027
On 31 August, an International Monetary Fund (IMF) mission began work in Ukraine on the second review of the programme.
Over the first seven months of 2026, Ukraine received UAH 1 trillion in financial assistance, which was credited to the budget as grants.
As of 1 August 2026, balances on the accounts of the government and of local budgets stood at UAH 714 billion (or USD 16 billion).
International reserves fell over August 2026 from USD 51.2 billion to USD 48.7 billion.
The government’s programme
On 17 August, the government of Ukraine presented its action programme for 2026–2027. In that document, the government set out four programme areas:
A. Strengthening resilience and bringing a just peace closer
B. Restoring and developing human capital
C. Building a capable European state
D. Accelerating recovery and economic development
Key points by area:
1) Strengthening resilience and bringing a just peace closer
2) Restoring and developing human capital
3) Financial stability and economic growth
4) Building a capable European state
Overall, the government’s programme is more a plan for moving the state into a condition of endless war, together with a desire to show good results and measurable targets in that condition.
Some of the measurable indicators will be very easy to hit — especially in the Ministry of Finance’s area. At the same time, delivering these government actions requires far greater financial resources, and we expect the 2027 budget to reveal the true financing needs.
Beyond that, half the country effectively lives under constant air-raid alerts, the outflow of citizens continues, and the state is unable to protect infrastructure and business facilities from destruction. Against this background, many of the targets look unclear and unattainable, and part of the work done by officials in the ministries is directed at the demands of external actors rather than at Ukraine’s real domestic problems.
Achieving peace is not part of the government’s plans, and this shapes the general pessimism about how the programme will be delivered.
IMF technical mission (second programme review)
On 31 August, an IMF mission began work in Ukraine. Neither the Ministry of Finance nor the IMF has yet issued an official statement on the outcome of the meetings. From what is known now, the following can be noted:
ECONOMIC SITUATION
The State Statistics Service of Ukraine has calculated GDP growth for the second quarter of 2026. Growth is estimated at 0.4%. This is 0.2 percentage points lower than the Service’s previous estimate.
Source: State Statistics Service of Ukraine.
Consumer price inflation in August 2026 was 0.1% against July and 8.1% against August 2025.
Core inflation was 0.5% (against July 2026) and 8.1% (against August 2025) respectively.
Price changes over the past 12 months. Source: State Statistics Service of Ukraine.
On the consumer market in August, prices for food and non-alcoholic beverages fell by 1.3%. Prices for vegetables and fruit fell the most, by 18.3% and 12.0%. Butter prices fell by 0.6%. At the same time, prices rose by 0.6–4.0% for eggs, sugar, fish and fish products, meat and meat products, cheese, bread, pasta and fermented milk products.
Prices for alcoholic beverages and tobacco rose by 1.5%, driven in particular by a 2.1% increase in tobacco products.
Clothing and footwear became cheaper by 2.5%: footwear by 3.1% and clothing by 2.2%.
The 1.3% rise in prices (tariffs) for housing, water, electricity, gas and other fuels came mainly from increases in water supply tariffs of 16.8% and sewerage tariffs of 16.7%.
Fuel and lubricants rose by 8.1% and road passenger transport fares by 6.6%.
Over the first seven months of 2026, the consolidated budget deficit was UAH 126 billion, against UAH 634.7 billion in 2025.
Tax revenues over seven months of 2026 were UAH 263 billion higher than in 2025. This came primarily from growth in personal income tax receipts (nominal wage growth), excise tax (tax increases) and VAT (nominal growth of the economy and of imports).
Over the first seven months of 2026, the budget received UAH 1,001 billion in grants. This is the same amount as in 2024 and 2025 combined.
Expenditure over the first seven months of 2026 was UAH 3,708 billion, UAH 695 billion more than in 2025. Spending on defence and internal security was UAH 533 billion higher than a year earlier. The main increase in expenditure therefore falls on the security sector.
Between 3 July and 25 August, the Ministry of Finance changed its financing reporting. In June, the Ministry recorded USD 2.843 billion as a loan from the EU under the Ukraine Facility. All EU funds are now recorded either as a grant or as a Ukraine Support Loan, which is also recorded as a grant. As a result, grant financing rose by UAH 428 billion in July alone. In our view, the state has reclassified the Ukraine Facility loan as grant financing.
Source: Ministry of Finance.
As of 1 August, government cash balances stood at UAH 714 billion. These funds are sufficient to finance budget expenditure until mid-November even without any inflow of Western financing.
In July 2026, Ukraine’s public and publicly guaranteed debt rose from USD 211.6 billion to USD 214.2 billion (+USD 2.6 billion).
The debt rose on the back of new domestic government bonds (+USD 0.9 billion), new loans from the IMF and the United Kingdom, and the revaluation of euro-denominated debt against the US dollar (+USD 1.7 billion).
The balance of payments was neutral in July 2026. The trade deficit continues to set records: over the first seven months of 2026 it was USD 41.875 billion, USD 10.95 billion more than in the same period of 2025 (USD 30.925 billion). Goods imports in July were more than three times higher than exports: USD 8.839 billion against USD 2.865 billion.
In July 2026, grant financing from the EU and other financing amounting to USD 6.8 billion was received. This made it possible to bring the current account to zero in July 2026.
The financial account was negative in July by USD 680 million — primarily because not all of the funds received from the EU under the defence tranche were credited to reserves.
We see that, even with substantial delays in EU financing, the National Bank of Ukraine (NBU) is not devaluing the hryvnia against the US dollar, and our earlier forecast has held: the NBU kept the rate within the range of 44.5–45.0 hryvnia to the dollar. The NBU sets the euro rate against the hryvnia on the basis of movements in the euro against the US dollar.
And although we see the Ukrainian authorities moving from one high-profile corruption scandal to the next, we believe that for the EU this may mean a delay in financing, while EU officials work to agreed terms. We therefore expect Ukraine to receive around USD 40 billion more in financing over the final four months of 2026, and this is our main assumption.
And although September is normally a month of reviving business activity and of hryvnia devaluation, we do not expect this to happen in September this year. With missile strikes on warehouses, business will rework its logistics, cut the stock held in large warehouses and shift to made-to-order and on-demand supply.
We believe that even if financing is delayed, the NBU will continue to hold the hryvnia against the US dollar in the 44.5–45.0 range in September.
The euro rate against the dollar has moved into the 1.15–1.17 range. If the Federal Reserve does not raise its rate at the meeting on 16 September, the dollar is likely to weaken against the euro. In our view, the euro rate may therefore pass the 52 mark after 16 September. The fluctuation range is 51.5–52.5 hryvnia per euro.
The hryvnia exchange rate against the US dollar and the euro over 12 months. Source: National Bank of Ukraine.
International reserves fell over August 2026 from USD 51.2 billion to USD 48.7 billion.
According to balance-sheet data, in August the NBU sold USD 4,850.7 million on the foreign exchange market and bought USD 0.5 million. The NBU was a net seller of USD 4,850.2 million in foreign currency.
A total of USD 927.3 million came into the government’s foreign currency accounts with the NBU in August, including:
Furthermore, international reserves increased by USD 1.63 billion because the government converted into hryvnia the respective amount of the funds previously received from the EU as part of the defence tranche under the Ukraine Support Loan. When received, these funds are not included in Ukraine’s international reserves because their use is restricted to a specific purpose. If the government sells these funds to the NBU for hryvnia so that they can be used for that purpose, international reserves increase by the corresponding amount.
A total of USD 721.8 million was spent on servicing and repaying the foreign currency public debt, including:
In addition, Ukraine paid USD 285.2 million to the IMF.
International reserves now cover 4.0 months of future imports.
Change in international reserves over the past 12 months. Source: National Bank of Ukraine.
15 September. Government of Ukraine. 2027 budget: submission to the Verkhovna Rada.
17 September. NBU. Decision on the key policy rate.
This publication was created by the Ukrainian Institute of the Future with the support of the Askold and Dir Foundation, administered by ISAR Unity as part of the project “Strong Civil Society in Ukraine – a Driver of Reforms and Democracy” funded by Norway and Sweden. The content of the publication is the responsibility of the Ukrainian Institute of the Future and does not reflect the views of the governments of Norway, Sweden, or ISAR Unity.
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