Ukraine's economy grows 1% in April after 3 months of contraction – IER

Ukraine's real gross domestic product (GDP) grew by 1% in April 2026 compared to April 2025 after shrinking for three consecutive months.

According to the Monthly Economic Monitoring of Ukraine (MEMU) published on the website of the Institute for Economic Research and Policy Consulting (IER), the economy contracted by 0.6% overall in the first quarter of 2026, while data from the State Statistics Service showed a 0.5% decline in Q1 2026.

"Lower electricity and gas consumption due to the earlier end of the heating season, as well as restored electricity generation and transmission capacity, ensured mostly uninterrupted electricity supplies despite fewer sunny days than in March. At the same time, the war in the Middle East drove fuel prices higher, increasing business costs," the 256th issue of MEMU said.

The report noted that despite improved access to electricity due to the partial restoration of generation capacity, the situation in the sector remained difficult in April. According to the institute's estimates, electricity production and gas distribution fell by 7% year-on-year.

Real gross value added (GVA) in the mining industry increased by only 1% year-on-year in April from a low comparison base caused by disruptions in gas and iron ore extraction due to Russian shelling. Real GVA in manufacturing industry is estimated to have risen by 4% compared to the same period of 2025, with growth slowing because of a decline in metallurgical output.

IER estimates real GVA growth in trade at 4% year-on-year in April, reflecting stronger demand and positive business sentiment. Real GVA in transportation declined by 7% due to high fuel prices, lower shipments of iron ore and oil, and continued Russian attacks. Construction likely posted slight growth.

Ukrainian Prime Minister Yulia Svyrydenko said on Tuesday, May 19, that Ukraine's GDP decline for the first four months of 2026 had narrowed to 0.2%.