In Q2 2025, businesses remained optimistic about their economic performance over the next 12 months. On the back of improved inflation and exchange rate expectations, respondents continued to expect an increase in the output of Ukrainian goods and services, while also reporting a positive outlook for the performance of their companies.
The business outlook index (BOI) was 103.1%, compared to 108.2% in Q1 2025 (Q1).
Respondents remained upbeat about total sales, investment in machinery, equipment and tools, and about the financial and economic standings of their companies.
In contrast, respondents reported guarded expectations for their construction spending, while declaring stronger intentions to lay off staff. A rebound in business activity was expected by companies in 13 oblasts and across most economic sectors.
Respondents continued to refer to the war and its repercussions as the most crucial factor that hampered their ability to step up production. The impact of qualified staff shortages has remained substantial.
Businesses’ Macroeconomic Expectations for Ukraine
Respondents continued to expect an increase in the output of Ukrainian goods and services over the next 12 months, the balance of responses being 9.2%, compared to 15.6% in Q1.
Companies in 15 oblasts, across most economic sectors (apart from transport and communications), and across all business activities and sizes based on their staff numbers, said they planned to step up production. The strongest intentions were reported by energy and water supply companies, large companies, and by companies that are exporters only.
Inflation expectations improved for the first in a year – in Q2 2025 the expected annual inflation rate for the next 12 months was 10.9%, down from 11.5% in the previous quarter. The percentage of respondents who believed that inflation would exceed 15.0% was 15.0%, down from 20.1% in the previous survey.
A total of 78.4% of respondents continued to see the ongoing hostilities as the most important inflation driver. Respondents also expected an increase in the impact of global prices and household income. Conversely, the impact of the exchange rate has weakened for three quarters in a row. Furthermore, the impact of tax changes was reported to have weakened significantly.
Respondents continued to report improved expectations for the hryvnia exchange rate: the average UAH/USD exchange rate was expected to hit UAH 43.84 per USD 1 in 12 months (UAH 44.23 per USD 1 in the previous quarter). 64.6% of respondents said the exchange rate would range between UAH 42.01 and UAH 45.00 per USD 1.
Companies’ Current Standings and Their Business Outlook
Respondents remained downbeat about the current financial and economic standings of their companies, the balance of responses being (-5.3%), down from (-3.4%) in Q1.
Respondents retained a positive outlook for the financial and economic standings of their companies over the next 12 months, the balance of responses being 2.4%, down from 4.7% in Q1 2025.
A more positive outlook was reported across most economic sectors, with companies in the mining industry, agricultural sector and energy and water supply being the most optimistic. At the same time, respondents from trading companies still reported gloomy expectations.
Businesses expected total sales, including external sales, to grow somewhat more slowly, the balances of responses being 10.5% and 9.4% respectively, compared to 20.7% and 19.5% in Q1.
Growth in total sales was expected across all sectors, but most of all by respondents from energy and water supply and agricultural companies, and by respondents engaged in other economic activities. An increase in external sales was expected by respondents from manufacturing, agricultural and trading companies, as well as by respondents engaged in other economic activities.
Respondents continued to report a positive investment outlook for machinery, equipment and tools, the balance of responses being 7.8%, compared to 13.4% in Q1. At the same time, respondents expressed guarded expectations for construction investment, the balance of responses being (-0.7%), compared to 2.7% in Q1.
Businesses that raise foreign investment continued to report expectations of investment growth over the next 12 months, albeit at a slower pace, the balance of responses being 14.3%, down from 17.2% in Q1. Transport and communications and energy and water supply companies were the most confident of a rise in foreign investment.
The share of respondents who planned to raise foreign investment over the next 12 months was 20.2%, up from 19.2% in the previous survey.
Respondents worsened their negative staff expectations for the next 12 months, the balance of responses being (-4.4%), compared to (-0.6%) in Q1. Gloomy expectations were reported by respondents across most sectors, with the dimmest expectations reported by transport and communications, trading and energy and water supply companies. In contrast, respondents from construction and mining companies declared intentions to hire more staff over the next 12 months.
Respondents reported weaker expectations of an increase in wage costs per staff member, the balance of responses being 49.8%, compared to 60.1% in Q1.
The percentage of respondents who planned to take out bank loans dropped to 33.9% (down from 35.2% in Q1) on the back of a decrease in borrowing needs in the near future (to 33.3% in Q2, down from 38.1% in Q1).
Companies that intend to take out loans continue to prefer hryvnia loans – 83.0%, compared to 80.9% in Q1. High loan rates remained the main factor deterring businesses from taking out new loans (47.7% of responses). The percentage of respondents who cited the availability of other funding sources remained significant, at 43.6%, down from 44.2% in the previous survey.
The impact of exchange rate fluctuations was reported to have increased slightly, by 2.2 pp, to 18.0%.
Respondents improved their assessments of lending conditions significantly, but still described these conditions as tight, the balance of responses being 9.8%, down from 17.3% in Q1.
The percentage of respondents who intended to take out foreign loans was 6.4%, down from 7.1% in the previous quarter.
This survey was carried out from 30 April through 28 May 2025. A total of 661 companies in 21 oblasts took part in the survey (excluding the temporarily occupied territory of Crimea, as well as Donetsk, Luhansk and Kherson oblasts). Of the businesses polled, 21.2% were in trade, 18.9% in manufacturing, 14.4% in agriculture, 13.8% in transport and communications, 6.1% in mining, 5.1% in energy and water supply, 3.2% in construction, and 17.4% in other sectors; 31.0% of the respondents were large companies, 36.6% medium companies, and 32.4% small companies.
The findings presented reflect only the opinions of the respondents (top managers of companies), and should not be considered as NBU assessments.
The business outlook index is an aggregated indicator for companies’ performance expectations over the next 12 months. It is calculated on the basis of survey findings as the arithmetic mean of the balances of responses regarding companies’ financial and economic standings, total sales of their own products, investment spending on construction, and on machinery, equipment and tools, as well as regarding staff numbers. An index above 100 indicates that positive economic sentiment prevails in society, while an index below 100 shows that negative economic sentiment prevails.