According to the assessment of the renowned economist and former head of the NBU Council, Bohdan Danylyshyn, the Ukrainian economy is entering a "danger zone" in which the pace of growth in output volumes has nearly stalled, production costs are rising, export opportunities are narrowing, and the trade deficit is widening. Additional strikes on energy, transport, warehouses, and port infrastructure are creating further pressure on prices. The author of the column for RBC-Ukraine emphasizes that full-fledged stagflation has not yet set in in the country, but its signs are already taking shape — weak production dynamics are combined with persistent inflation and deteriorating supply.
Figures That Leave No Illusions
According to the State Statistics Service's preliminary estimate, real GDP in the second quarter of 2026 grew by only 0.6% compared with the same quarter of the previous year and by 0.4% compared with the first quarter. Following the 0.5% GDP decline in the first quarter, this is, in Danylyshyn's words, more of a technical recovery than a transition to sustained growth. Meanwhile, in August, annual consumer inflation accelerated to 8.1%, and core inflation also stood at 8.1%. Certain categories rose noticeably faster: transport by 23.8% over the year, fuel by 38.7%, and road passenger transport by 39.1%. The NBU forecasts inflation accelerating to 10% by the end of 2026, with real GDP growth of only 1.8%, while the rebuilding of logistics following new Russian attacks could add a further 0.4–0.6 percentage points to annual inflation.
Parallel Policies Instead of a Single Center
In the expert's view, the main threat is not simply rising prices, but the combination of several crisis processes that cannot be addressed by raising the interest rate alone. At the same time, it is also wrong to place the entire responsibility for the state of the economy on the National Bank. Danylyshyn argues that it is precisely the Cabinet of Ministers that should play the leading role: government bonds (OVGBZ), the "5-7-9%" program, interest-rate compensation, and state guarantees are tools and the area of responsibility of the government. The NBU influences the cost of money, banking incentives, and overall financial conditions, but it does not determine how the state spends borrowed resources. Today, he says, there is no coherent center of economic responsibility: fiscal, debt, credit, industrial, energy, and monetary policies exist in parallel and often neutralize one another.
"Paramonetarism" as a Consequence of Incoherence
The government stimulates certain industries, yet at the same time raises taxes and tariffs and borrows funds on the domestic market, without creating adequate mechanisms for channeling resources into production. A significant share of the programs supports working capital and the refinancing of existing obligations, rather than the creation of new production capacity. This gives rise to what the author calls Ukrainian paramonetarism: for the bulk of the economy, money is expensive, while for certain borrowers credit is budget-subsidized. Such a system, Danylyshyn stresses, is a consequence not only of the National Bank's policy but also of an incoherent monetary-fiscal design for which the government bears direct responsibility.
"A State of Emergency in the Economy" — What It Means
Ukraine has already been living under conditions of a full-scale war for the fifth year, yet a significant share of economic decisions is being made as if it were a temporary deviation from the peacetime cycle. The author calls for a shift from a de facto wartime economy to a systematically organized military economy and outlines a seven-step program, the key element of which is turning the Cabinet into a unified center of military economic management. By "a state of emergency in the economy," Danylyshyn does not mean total state regulation, blanket nationalization, or administratively set prices, but a special management regime in which the market remains the main mechanism for the economy's functioning, while the government coordinates the key directions. Criticism of the regulator, he notes, should not become a convenient substitute for analyzing government policy.
Contradictory Data
The materials presented contain discrepancies in assessments of the economy's trajectory. The State Statistics Service's preliminary estimate records a positive, albeit minimal, GDP growth in the second quarter of 2026 (0.6% year on year), which formally indicates a technical recovery after the first-quarter contraction. At the same time, the NBU's forecast for the full year 2026 looks considerably more restrained: real GDP growth of only 1.8% with inflation accelerating to 10%, plus an additional risk of 0.4–0.6 p.p. from the rebuilding of logistics. Thus, the same situation is described as a "recovery" based on quarterly data and as a "danger zone" with stagflationary risks based on annual forecasts. Moreover, in the debate over the causes of the strain, there are two competing versions: the position that reduces the problem to monetary policy and the NBU rate, and Danylyshyn's position, which shifts the center of responsibility to the government's fiscal and industrial policy. Both viewpoints are reflected in the column, and the sources record no final consensus on the distribution of responsibility between the NBU and the Cabinet.
