Ukrainian business sentiment worsened after five months of optimism

Ukrainian business in August worsened its assessments of its performance. The Business Activity Expectations Index (BAEI) of the National Bank fell to 48.3 points from 50.1 in July, dropping below the neutral level of 50 points.

For comparison, in August 2025 the index was 49 points. A value above 50 indicates prevalence of positive business assessments, below 50 - cautious expectations.

The main factors of deterioration in business sentiment were significant losses due to large-scale destruction of production facilities, warehouses and logistics infrastructure, blocking of sea ports, high fuel prices, and shortage of skilled workers.

At the same time, business was supported by stable consumer demand, international financial assistance, budget financing of infrastructure restoration and road construction, stable situation in the energy sector, and seasonal factors.

Industrial enterprises rated their prospects the worst. Their sectoral index fell from 50.7 in July to 47.3 in August. Companies expect a reduction in production volumes and new orders, including export orders. Industry is most pressured by destruction of production facilities, logistics problems, and shortage of workers.

Sentiment in trade also noticeably worsened: the corresponding index dropped from 50.8 to 47.5 points. Enterprises expect a decrease in turnover and purchases of goods for sale, further reduction in inventories, and lower trade margins. The NBU attributes this, in particular, to destruction of warehouses and logistics complexes and high fuel costs.

The services sector, on the contrary, slightly improved its assessments: its index rose from 48.8 to 49.5 points. Companies maintained positive expectations for new orders and started predicting an increase in the volumes of services provided.

Construction remained the only surveyed sector with positive expectations. The sectoral index was 50.7 points, although it decreased from July's 54.2. Enterprises expect an increase in construction volumes, new orders, and purchases of raw materials and supplies.

Most sectors also expect an acceleration in the growth of purchase prices, cost of raw materials and supplies, and prices for their own goods and services. The exception is builders, who forecast some slowdown in the pace of price increases.

The employment situation remains difficult. Only construction companies plan to increase the number of employees. Enterprises in industry, trade, and services expect a reduction in staff, with the largest reduction expected in industry.

The NBU survey was conducted from August 4 to 21 among 586 enterprises. Its results reflect the assessments of company managers, not forecasts of the National Bank itself.

Based on materials: National Bank of Ukraine