Ukraine Business Sentiment Rebounds in Q1 2026 as Activity Index Breaks Downward Trend

Ukrainian businesses show improved optimism in Q1 2026 as the NBU Business Expectations Index breaks a three-quarter decline despite ongoing war pressures.

By: AXL Media

Published: Apr 17, 2026, 4:19 AM EDT

Source: Information for this report was sourced from the National Bank of Ukraine (bank.gov.ua).

A Decisive Turn in Economic Sentiment

The Ukrainian private sector has signaled a definitive shift toward recovery, as the Business Expectations Index (BEI) climbed to 105.8% in the first quarter of 2026. This uptick marks the first time in nearly a year that economic sentiment has broken its negative trajectory, moving from a modest 102.1% at the end of 2025. According to the National Bank of Ukraine’s latest survey of 664 company executives, there is a burgeoning confidence in the production of goods and services, suggesting that the domestic economy is adapting to the prolonged operational challenges of a wartime environment.

The Resilience of Production and Sales Targets

For the first time since 2024, the balance of responses regarding future production volumes turned positive, reaching 0.6% after a period of contraction. This optimism is most pronounced in the energy and water supply sectors, which are prioritizing restoration and modernization, as well as in agriculture and manufacturing. Companies are particularly bullish on sales performance, with expectations for total sales volumes jumping to 14.5%. Notably, external market ambitions remain high, as businesses look to expand their export footprints to offset fluctuations in domestic demand.

Persistent Constraints and the Labor Market Crisis

Despite the rising optimism, the shadow of active conflict continues to weigh heavily on industrial capacity, with 83% of respondents citing military action as the primary factor limiting growth. Beyond the direct physical risks, the shortage of skilled personnel has emerged as a systemic crisis. While the overall decline in staff numbers is beginning to level off, particularly in the energy sector, agricultural and mining enterprises continue to report significant difficulties in retaining workers. This talent drain is compounded by expectations of rising energy prices, which executives believe will be a dominant cost driver in the coming year.