The National Bank of Ukraine raised its key policy rate by 50 bps to 16% at its September 2026 meeting, following a similar 50 bps increase at the previous meeting, which had been the first hike in 18 months. The central bank’s Board noted that underlying inflationary pressures continued to build, driven by second-round effects of supply shocks in global energy markets. Consumer inflation in Ukraine climbed to 8.1% in August, slightly exceeding the central bank’s forecast, as the escalation of the war in the Middle East led to a sharper-than-expected surge in fuel prices. At the same time, the labor market remained relatively stable, with solid employment levels and accelerating wage growth. These developments justified a more restrictive monetary policy stance, which is also expected to support the hryvnia and help prevent capital outflows by residents and domestic companies.