After Russia’s intensified strikes on Ukraine’s civilian logistics and retail businesses, added rebuilding costs and rising expenses could contribute roughly 0.4-0.6 percentage points to annual inflation by the end of 2026, National Bank of Ukraine (NBU) Deputy Governor Volodymyr Lepushynskyi wrote in an op-ed for Interfax-Ukraine.
During August, Russian forces have been conducting massive attacks on civilian logistics and the retail sector, creating another push for already challenging inflation as a result of the war in the Middle East, devastating Russian ballistic strikes, and the halt of the Black Sea corridor caused by Russian strikes on vessels.
According to previous reports, Ukraine’s annual consumer inflation rate accelerated to 7.7%, while core inflation held at 8.1%.
The economic toll of Russia’s intensified strikes on Ukraine’s civilian and business infrastructure has moved from a line item in risk forecasts to a measurable entry in the country’s inflation data, said Lepushynskyi.
Strikes on enterprises, warehouses, and logistics hubs, along with attacks on energy infrastructure, and the de-facto blockade of maritime shipping routes now carry a price tag that can be measured directly, he added.
They raise business costs, complicate exports, generate extra demand for imports, and put pressure on prices, the currency market, and corporate expectations.
At the same time, he points out Ukrainian businesses are adapting quickly, rerouting logistics, redirecting exports to alternative corridors, restoring damaged capacity, keeping the financial system running, and preserving the hryvnia’s appeal as a savings instrument.
Most of that effect will show up in the autumn, he said, but the NBU does not expect a sharp price spike – the impact will be spread out over time and partly offset by competition among businesses and softer demand.
Lepushynskyi stressed that the damage to a warehouse or distribution center does not automatically translate into a one-for-one increase in shelf prices. Logistics and storage account for about 8% of the average consumer price, and competitive pressure limits how much of the added cost businesses can pass on to buyers.
One reason for the gap is new destruction that had not yet occurred when the NBU prepared the July forecast, according to Lepushynskyi.
The NBU’s baseline scenario accounted for shelling and rising logistics costs known at the time, but fresh attacks on logistics infrastructure followed after the forecast’s data cutoff, he added.