Numbers Tell the Truth. Slogans Don’t.

Out of long-standing habit, I read the NBU’s October Inflation Report. It’s a document I have been following for many years, and always with particular attention. If there is anything stable in Ukraine’s economic policy framework, it is the professionalism of the team that prepares these reports. The people at the NBU do complex, often invisible, but extremely important work. And for that reason alone, their documents deserve far closer attention than the loud political statements coming from various offices.

This time, the numbers turned out to be far more honest than the political rhetoric.

The first thing that stands out is GDP dynamics. According to the NBU’s forecast, Ukraine’s economy is expected to grow by 1.9% in 2025, 2.0% in 2026, and 2.8% in 2027. For a country that lost more than a third of its economy in 2022, these figures do not represent growth. This is stagnation — movement in place that appears positive only in comparison to the collapse of previous years.

The structure of this “growth” tells an even clearer story. The fiscal impulse in the third quarter of 2025 reached +16.9% year-on-year. Defense spending surged by 33%, and public-sector wages increased by 9.9%. In other words, it is the state — not the private sector — that is holding the economy afloat.

The second key element is external trade. The goods trade deficit in Q3 reached USD 13.6 billion, significantly worse than USD 11.7 billion in Q2. Agri-exports declined due to depleted stocks; metallurgy is barely expanding, showing only 2.8% year-on-year growth; logistics are operating at the edge of capacity. Meanwhile, imports of machinery and energy-related equipment are rising sharply: an additional USD 230 million in energy-sector imports and USD 650 million in electronics for defense production. This is a textbook picture of a wartime economy — but certainly not a picture of “stability.”

The third indicator is investment activity. The Business Expectations Index fell to 49.2 points in Q3 — below the neutral threshold. Balance-of-expectations metrics for investment in equipment and construction are in negative territory. This means one thing: businesses are not planning expansion, are not looking ahead, and are unwilling to take risks. The only factor keeping investment nominally positive is public capital expenditure — something the NBU acknowledges explicitly.

The fourth factor is the war itself. According to ACLED, the number of newly damaged residential buildings is up 239% year-on-year; energy infrastructure damage is up 137%; damage to healthcare facilities is up 100%. These are not abstract numbers. This is the operational environment in which the entire economy functions — from logistics to industrial production.

And now the main point. In 2025, Ukraine expects USD 51.5 billion in external financial support. In 2026 — USD 45 billion. In 2027 — USD 39 billion. These flows are what enable the country to finance its budget deficit, support the armed forces, maintain the exchange-rate regime, and preserve macro-financial stability.

The NBU articulates this very clearly: external financing exceeds the foreign-currency deficit of the private sector, which is why international reserves remain at an “adequate level.” By the end of 2025, the NBU forecasts USD 54 billion in international reserves — a level 19% above the minimum adequacy threshold defined by IMF composite metrics.

Formally, these are “record reserves.” But their nature is entirely different from what is being portrayed in the public space. Reserves are high not because the economy is generating foreign currency. Reserves are high because donors are financing the country at a scale exceeding USD 50 billion per year. Presenting this as a domestic economic achievement is misleading the public.

It is also worth addressing the shift in rhetoric within the inflation reports themselves. In 2024, most core statements were cautious: “subject to continued external support,” “if cooperation with partners persists,” “if inflows remain rhythmic.” In the 2025 report, these conditional formulations disappear. The language is now explicit: the deficit is financed by external funds; exchange-rate stability is ensured by international support; external resilience is the result of donor programmes.

This is not a change in style. This is a change in era.In previous years, the NBU had to leave room for optimism. Now — for the first time in many years — it has formally acknowledged the Donornomics model as the fundamental reality of Ukraine’s economy.

And the NBU deserves credit for this. Honesty is also a form of policy — sometimes more important than optimism. Especially in a country living through war, economic fatigue, infrastructure destruction, investment stagnation, and structural dependence on external resources.

That is why such documents must be read carefully.This is not just macroeconomic analysis — this is a diagnosis, delivered accurately, professionally, and without embellishment.And only with such a diagnosis can policy be planned. Not by hiding behind loud claims about “record achievements” that mean nothing without real underlying substance.