The European Bank for Reconstruction and Development (EBRD) has lowered its forecast for Ukraine’s real gross domestic product growth in 2026 to 2.2% due to the protracted war, but notes that macroeconomic stability has been maintained thanks to external support.
“This is slightly lower than the 2.5% forecast published in February, but should hostilities ease and post-war reconstruction begin, the forecast for 2027 remains unchanged at 4.0%,” according to the EBRD’s “Regional Economic Prospects” (REP) report, published on Wednesday.
The bank emphasizes that Ukraine is maintaining macroeconomic stability even in the fifth year of Russia’s aggressive war thanks to significant external financing. The outlook continues to depend largely on the course of the war and the availability of external financial support.
“The main downside risk to the forecast is linked to the energy crisis caused by the conflict in the Middle East, which could significantly worsen Ukraine’s already unstable energy situation,” the report states.
The EBRD attributes the slowdown in economic growth to 1.8% in 2025 and the weak start this year to ongoing wartime constraints: labor shortages and persistent attacks on energy infrastructure have disrupted industrial activity and logistics, while broader supply chain issues have limited production.
The bank notes that inflation has also begun to rise again after slowing to 7.4% in January 2026 following a period of tighter monetary policy and relative exchange rate stability. Higher global energy prices linked to the conflict in the Middle East are adding new pressure, increasing costs for businesses and households and contributing to a resurgence of inflationary momentum.
According to the EBRD, fiscal support remains crucial. Ukraine’s budget deficit, excluding grants, reached 23.6% of GDP in 2025 and is projected to remain elevated at 19.3% of GDP in 2026, reflecting exceptionally high spending on defense and social services. These needs are financed largely through official external support, which continues to underpin macroeconomic stability. The allocated external financing of over EUR110 billion for 2026–27 is expected to mitigate short-term risks.
The Bank notes that it is Ukraine’s largest institutional investor and has significantly increased its support in response to the full-scale war: since its onset in February 2022, the EBRD has allocated nearly EUR10.0 billion to Ukraine.
As reported, the National Bank lowered its GDP growth forecast for this year to 1.3% from 1.8% in April.
The government’s forecast, included in the 2026 state budget, currently projects 2.4% growth, but Economy Minister Oleksiy Sobolev recently announced plans to revise it downward.
According to the State Statistics Service, Ukraine’s GDP growth slowed to 1.8% in 2025 from 2.9% in 2024 and 5.5% in 2023, following a 28.8% decline in 2022—the first year of full-scale Russian aggression.
The Ukrainian Grain Association (UGA) has raised its estimate of the potential 2026 grain and oilseed harvest by 1 million tons—to 83.6 million tons, which is 11.6% higher than the 2025 figure (74.9 million tons)—due to increased yields of corn and sunflower, the UGA press service reported on Monday.
“With such a harvest, exports in the new 2026/2027 season could potentially reach 50.8 million tons (the export estimate for the current season is 42.3 million tons). However, this is an optimistic scenario, the realization of which will be possible only if Ukraine’s logistical problems do not worsen due to Russia’s aggression and its constant bombing of Ukrainian transport infrastructure and energy facilities,” the statement noted.
According to the UGA’s estimate, the wheat harvest in 2026 could reach 22.8 million tons (22.5 million tons in 2025), and its exports in the 2026/2027 marketing year (MY) could reach 17 million tons compared to the expected 13.5 million tons in the current season.
The UGA estimates the barley harvest in 2026 at 5.2 million tons (4.9 million tons in 2025), with likely exports of about 2.2 million tons, compared to 1.6 million tons in the current season.
According to the UGA’s forecast, the corn harvest in 2026 will total 32.1 million tons (31.1 million tons in 2025), and exports could reach 27 million tons compared to 22 million tons in the current season.
“Expectations for this year’s corn harvest are positive thanks to favorable weather conditions so far,” the association explained.
The UGA expects the sunflower harvest in 2026 to reach 13.3 million tons, compared to 11.1 million tons in 2025.
“Traditionally, almost all sunflowers will be processed in Ukraine—13.5 million tons. Exports will not exceed 50,000 tons,” the statement said.
In 2026, the rapeseed harvest, according to UGA forecasts, could reach 3.4 million tons compared to 3.2 million tons in 2025, while exports for the 2026/2027 marketing year may amount to only 1.9 million tons.
This year’s soybean harvest is expected to reach 4.9 million tons, which is less than last year’s 5 million tons, while potential exports are projected at 2.3 million tons compared to 2.9 million tons in the current season.
As reported, the U.S. Department of Agriculture (USDA) forecasts wheat and corn exports from Ukraine in the 2026/2027 season at 13 million tons and 23 million tons, respectively, which is 0.5 million tons and 1 million tons more than in the current season.
At the same time, the USDA expects wheat production to decline to 23 million tons from 24.1 million tons last year, and corn production to decline to 30 million tons from 30.9 million tons last year.
In Ukraine on Wednesday, May 27, there will be scattered showers overnight in the northern regions and widespread showers during the day; thunderstorms are expected in the central and southern regions and in the Carpathian foothills, according to the Ukrainian Hydrometeorological Center.
Winds will be westerly and northwesterly, 7-12 m/s, with gusts of 15-20 m/s during the day across Ukraine.
Temperatures will range from 11-16°C at night and 18-23°C during the day, with highs of 23-28°C in Zakarpattia and the south of the country.
In Kyiv, no precipitation is expected on Wednesday night, with brief showers during the day. Winds will be northwesterly, 7-12 m/s, with gusts of 15-20 m/s during the day. Nighttime temperatures will range from 14-16°, and daytime temperatures from 21-23°.
According to data from the Boris Sreznevsky Central Geophysical Observatory in Kyiv, on May 27, the highest daytime temperature was 33.6° in 2007, and the lowest nighttime temperature was 1.7° in 1904.
On Thursday, May 28, light, brief showers and thunderstorms are expected at night in the south, east of the country, and in the Carpathians, and during the day across Ukraine, except for the southern regions and Zakarpattia.
The wind will be northwesterly, 7–12 m/s, with gusts of 15–20 m/s in some areas during the day in most regions.
Temperatures will range from 7–12° at night to 13–18° during the day; in Zakarpattia and the south of the country, temperatures will range from 11–16° at night to 18–23° during the day.
In Kyiv on Thursday, no precipitation at night, with light, brief showers during the day. Wind from the northwest, 7-12 m/s. Nighttime temperatures 10-12°, daytime 15-17°.
Ukraine plans to increase biomethane production to approximately 150 million cubic meters by 2026, and a production level of 500 million cubic meters is a realistic goal by 2030, according to a forecast by the Ministry of Economy, Environment, and Agriculture following a meeting with the European Investment Bank
“Ukraine has significant resources for producing biomethane from agricultural waste, livestock byproducts, straw, and sugar beets, which meets European requirements for ‘green’ fuel,” Deputy Minister Taras Vysotsky is quoted as saying in a press release on the ministry’s website.
He emphasized that exports to the EU should become the main driver of market development. The Deputy Minister noted that in 2025, Ukrainian private producers exported over 11.2 million cubic meters of biomethane via Ukraine’s gas transmission system for the first time.
Among the key challenges, he cited integration into the European certification system and the creation of the necessary technical database.
Following the meeting, the parties agreed to continue coordinating their work and further developing priority areas of cooperation in the fields of land reclamation, water resource management, and the development of sustainable agricultural infrastructure, as well as the biomethane sector.
As reported, on April 23, 2026, the government approved the Biomethane Production Development Program for the period up to 2035, which calls for increasing production to 2.1 billion cubic meters over 10 years.
According to data from the “Gas Transmission System Operator of Ukraine” (GTSOU), as of early February 2026, the declared capacity of biomethane producers in Ukraine, based on issued technical specifications for connection to the gas transmission system, stood at 11,000 cubic meters per hour, which equaled 96 million cubic meters per year.
In its May report, the U.S. Department of Agriculture (USDA) issued its first forecast for wheat and corn exports from Ukraine in the 2026/2026 marketing year (MY) – 13 million tons and 23 million tons, respectively, which is 0.5 million tons and 1 million tons more than in the current MY.
According to USDA estimates, Ukraine’s wheat harvest in the next MY will decline to 23 million tons from 24.1 million tons last year, but ending stocks for the year will increase by only 0.9 million tons—to 4.53 million tons—while this year they are expected to rise by 2.9 million tons.
As for the corn harvest, USDA analysts forecast it at 30 million tons this year, compared to 30.9 million tons last year. The increase in exports is also expected to result from a decrease in ending stocks by 0.19 million tons, while this marketing year they are projected to increase by 1.91 million tons.
Taking other crops into account, the U.S. Department of Agriculture expects this year’s forage grain harvest to decrease to 36.08 million tons from 37.22 million tons last year, but an increase in its exports next marketing year to 25.19 million tons from 24.30 million tons this marketing year, also due to carryover stocks accumulated this year.
As reported, the Ministry of Economy forecasts a grain harvest of approximately 60.4 million tons in 2026, which is only 1%, or 0.64 million tons, less than last year. According to preliminary estimates by the Ministry of Economy, the harvest of major crops may amount to: wheat – about 22.4 million tons, barley – about 4.7 million tons, and corn – about 31.6 million tons.
According to the State Statistics Service, the wheat harvest in 2025 increased by 3.6% to 23.34 million tons, corn by 14.6% to 30.9 million tons, while the barley harvest decreased by 2.4% to 5.2 million tons.
The U.S. Department of Agriculture expects this year’s wheat harvest to decrease to 819.06 million tons and its exports to 211.70 million tons, down from 843.84 million tons and 222.68 million tons, respectively, last year.
The USDA’s first forecast for global corn production this year is 1,295.38 million tons, with exports for the 2026/27 marketing year at 206.91 million tons, while last year’s harvest was 1,312.68 million tons, and exports for the 2025-26 marketing year are expected to reach 213.59 million tons.
The US dollar-to-euro exchange rate at the end of 2026 will be $1.16/EUR1; the Cabinet of Ministers approved this updated estimate in the draft amendments to Ukraine’s state budget (No. 15224), whereas it had previously projected it at $1.08/EUR1.
As noted in the explanatory note to the draft, these changes have affected the assessment of the maximum levels of public debt: it will decrease by only UAH 332.2 billion, although financing of the state budget through debt operations will be reduced by UAH 651.5 billion thanks to the attraction of €13.2 billion in new budgetary support from the European Union under the Ukraine Support Loan.
According to the draft, it is proposed to set the public debt ceiling at the end of this year at 10 trillion 145. 6 billion UAH and the ceiling for state-guaranteed debt at 464.6 billion UAH, with budget revenues of 5 trillion 195.9 billion UAH and expenditures of 6 trillion 407.1 billion UAH.
As reported, in the calculations for Ukraine’s 2026 state budget, the government for the first time included a separate indicator for the projected average annual euro-to-hryvnia exchange rate—49.4 UAH/EUR1—in addition to the traditional average annual dollar exchange rate, which the Cabinet of Ministers expects to be 45.7 UAH/$1 this year.
In recent years, the share of euro-denominated obligations in Ukraine’s national debt has grown significantly, as the EU has become Ukraine’s main donor, while financial support from the U.S. has declined.
Public and state-guaranteed debt for the first quarter of 2026 increased by 190.4 billion UAH, or 2.1%, to 9.233 trillion UAH, but decreased by $2.5 billion, or 1.2%, to $210.8 billion in dollar terms.
The share of debt in euros as of the end of March this year was 44.08%, while in dollars it was 22.74%, in hryvnia 20.94%, and in IMF Special Drawing Rights (SDR) 9.12%.
In its updated April Inflation Report, the National Bank of Ukraine projects an average annual dollar-to-euro exchange rate of $1.18/EUR1, which corresponds to the current rate, compared to $1.13/EUR1 in 2025.
The official hryvnia-to-dollar exchange rate currently stands at 43.8033 UAH/$1, and the hryvnia-to-euro rate at 51.5433 UAH/$1.
