Key take-aways
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Index moves back into contraction zone.
The National Bank of Ukraine’s Business Activity Expectations Index dropped from 50.0 in June to 48.3 in July 2025, yet remains well above the 44.4 recorded a year earlier. -
Main head-winds.
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New waves of missile and drone attacks damaged critical infrastructure.
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Input costs for raw materials, fuel and wages continued to climb.
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Shortages of qualified staff intensified, pushing payroll expenses higher.
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Persistent inflationary pressure eroded margins.
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Offsetting tail-winds.
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The power grid stayed largely stable, avoiding last year’s blackout scenario.
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Seasonal and pent-up consumer demand kept order books ticking over.
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Re-routed export logistics via Danube ports and EU “solidarity lanes” ensured sales channels remained open.
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Sector snapshot.
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Services—largest employment cuts expected; customer traffic still growing modestly.
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Manufacturing & agri-processing—higher costs trim output plans, but export orders prevent a sharper slide.
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Construction—donor-funded reconstruction sustains new project starts despite expensive materials.
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Labour market.
All sectors anticipate a net reduction in headcount over the next three months, with the steepest decline in services. -
Macro implications.
The NBU maintains its 2025 GDP growth forecast at ~2 %, down from last year’s 5 %-plus rebound. Inflation dynamics and winter energy security will determine whether sentiment can rebound above the 50-point neutral line by year-end.
Bottom line: July’s dip signals caution, not collapse. If energy stability holds and import costs ease, business sentiment could regain momentum heading into Q4.
