The NBU has assessed the impact of the war in the Middle East on Ukraine: inflation may rise

The National Bank of Ukraine is considering two scenarios regarding the impact of a war between Iran and the United States on the Ukrainian economy, depending on the duration of the conflict and oil prices.

This was stated by NBU Governor Andriy Pyshnyy.

Under the baseline scenario, tensions in the Middle East will begin to ease as early as the end of the second quarter, and the price of Brent crude will fall to $80 per barrel by the end of 2026. In this case, inflation in Ukraine will rise by 1.5 percentage points, and GDP growth will slow by 0.3 percentage points.

The negative scenario assumes a prolonged conflict and an oil price exceeding $100 per barrel by the end of 2026. In that case, inflation could accelerate by 3 percentage points, and economic growth would slow by 0.6 percentage points.

Against the backdrop of these risks, the NBU has already revised its year-end inflation forecast downward from 7.5% to 9.4%, and its GDP growth forecast from 1.8% to 1.3%.

The regulator also left the policy rate at 15%.

Iranian authorities have begun granting permission to select Chinese vessels to pass through the strategically important Strait of Hormuz.

The Strait of Hormuz has once again come to a near standstill

Additionally, the U.S. military struck the vessel Touska, which was attempting to pass through the Strait of Hormuz under the Iranian flag despite the blockade.