Business Activity Expectations in Ukraine: July 2026 Reading
The Business Activity Expectations Index (IODA) for July 2026 came in at 50.1, slightly below June's 50.4 but still well above the 48.3 recorded a year earlier in July 2025. This marks the fifth consecutive month in which Ukrainian businesses have given a positive assessment of their prospects. Among the sectors, construction firms once again posted the most upbeat expectations, while service providers were the only group to hold back with more cautious views.
Across all sectors, respondents anticipate that price growth for inputs, raw materials, and materials will continue to slow, along with their own output prices and tariffs. The one exception is services, where a modest pickup in the pace of own price increases is expected.
Labor Market Trends and What's Driving the Optimism
On the employment front, the picture is mixed. Only construction firms plan to expand their workforce; industry and services expect to trim headcount, while trade companies project stable staffing levels.
Several factors made it easier for businesses to maintain a positive outlook, including:
- incoming international financial support,
- vigorous consumer demand,
- state budget financing for infrastructure repairs and road construction,
- a steady energy situation,
- improving inflation expectations,
- and seasonal effects.
At the same time, several headwinds continue to weigh on economic activity:
- more frequent shelling of critical facilities,
- greater logistical complications,
- slightly firmer exchange-rate expectations,
- and a shortage of skilled workers.
These figures capture an economy where strong momentum in sectors such as construction sits alongside persistent challenges for other industries.
The fact that businesses are still leaning optimistic suggests they are adapting to the current environment, even though security and logistics risks remain very real. That underlines how vital international assistance and infrastructure investment are for keeping Ukraine's economy stable and moving forward.
Despite the slight dip in the Business Activity Expectations Index for July 2026, Ukrainian businesses have shown a remarkable upgrade in their outlook recently, highlighting a contrasting trend in optimism across various sectors. This evolving landscape prompts a closer examination of the factors driving such positive expectations among entrepreneurs amid ongoing economic challenges.