The State Statistical Service (SSS) reported that construction output in Ukraine increased by 3.3% y-o-y in January, as infrastructure construction rose by 16% y-o-y while real estate construction declined by 6.5% y-o-y. On a related note, the SSS revised its construction data for 2023-2025, lowering 2025 growth by 0.7pp to 11.3% (though December’s reading was upgraded to 15.9% from 9.6%). At the same time, it raised the 2024 tally by 2.3pp to 17.8% from 15.5% and revised 2023 growth up by a sizable 6.8pp to 32% from 25%.

The Cabinet of Ministers cancelled its order that mandated state-owned oi and gas company Naftogaz, rail operator Ukrainian Railways and defense conglomerate Ukroboronprom to cover at least 50% of their electricity consumption through imports. In parallel, the government also lowered to 60% from 90% the threshold for mandatory power imports by commercial consumers required to secure uninterrupted power supply.

The Federal Supreme Court of Switzerland has upheld the decision of the arbitration tribunal in Zurich and rejected a request by Russia’s Gazprom to annul the June 16, 2025 arbitration award ordering Gazprom to pay Naftogaz more than $1.4bn for gas transit services, plus interest.

• The intensity of Russian attacks and territorial gains remains at yearly lows. • The fighting is concentrated in three sectors in the Donetsk and neighboring Zaporizhya regions, with activity along the rest of the 1,200 km front line comparatively low. • Ukraine’s interception of Russian missiles and drones has improved markedly, but sustaining this positive dynamic depends on continued interceptor supplies, which appear at risk.

Naftogaz announced that it has engaged financial and legal advisors to manage its debt portfolio, which includes, but is not limited to, its Eurobonds (EUR 695m due Jul. 19, 2026, and $584m due Nov. 8, 2028). No firm commitment has been made at this stage, and the company said it will provide updates when available.

Kyivstar reported strong 2025 results, with sales and EBITDA both increasing by 26% y-o-y to $1.2bn and $648m — close to the upper end of the company’s guidance in January. Both came in slightly above our forecasts, reflecting stronger mobile ARPU growth and a higher-than-expected revenue jump at Uklon, Kyivstar’s ride-hailing business.

Ukraine’s real GDP grew by 1.8% y-o-y in 2025, according to provisional official data, slowing from 3.2% in 2024 and 5.5% in 2023. The statistical office also slightly revised quarterly data, reporting real GDP growth of 0.8% y-o-y in 1Q25 (revised by -0.1pp), 0.9% in 2Q25 (+0.2pp), 2.4% in 3Q25 (+0.3pp) and 2.8% in 4Q25 (-0.2pp). The State Statistics Service reported a 2025 GDP deflator of 14.5% y-o-y (vs. 12.0% in 2024) and nominal GDP at UAH 8,931bn, or $214bn.

The Ukrainian parliament’s economic development committee recommended that the government not increase freight tariffs for Ukrainian Railways in 2026.

Nasdaq-listed Kyivstar, Ukraine’s largest mobile network operator and leading digital player, published its 2025 financial results, reporting revenues of $1,157m (+26% y-o-y), EBITDA of $648m (+26%) and net income of $286m (+1.1%). The EBITDA margin remained flat y-o-y at 56.0%. The results imply 4Q25 EBITDA of $172m (+0.6% q-o-q and +22% y-o-y), with the EBITDA margin down 4.0pp q-o-q to 53.6%.

Naftogaz CEO Sergiy Koretsky said the company’s oil pipeline infrastructure in southern Ukraine came under attack for two consecutive days. The company stated that the main objective of the strikes was to prevent alternative supplies of non-Russian oil to Europe.

The volume of natural gas in Ukraine’s underground gas storage (UGS) stood at 9.5 bcm as of end-February, down 11% from 10.6 bcm at end-January but up 58% y-o-y.

The National Bank’s gross international reserves declined by 5.0% ($2.9bn) m-o-m in February to $54.8bn, still up 36% y-o-y and equivalent to 5.7 months of prospective goods and services imports. The hryvnia weakened by 0.8% m-o-m against the US dollar in February to UAH 43.2:USD (official rate, -3.9% y-o-y) and lost another 1.5% in the first 11 days of March, bringing the YTD decline to 3.4% and pushing the currency to a new all-time low of UAH 43.9:USD.

Ukraine’s headline CPI rose by 1.0% m-o-m in February, accelerating from 0.7% in January and bringing y-o-y inflation to 7.6%, up from 7.4% in January. Core inflation, which excludes administratively regulated tariffs and prices of raw foods and energy, increased by 0.7% m-o-m, up from 0.4% in January, while the y-o-y rate remained unchanged at 7.0%.

Ukraine’s direct and guaranteed public debt totaled $215bn as of end-January, up 0.8% m-o-m and 27% y-o-y.

In this presentation, we provide an update on the battlefield situation in Ukraine, summarize our latest macro outlook for 2026-2027 distributed earlier today, and offer our updated views on sovereign Eurobonds and liquid corporates.

Ukraine’s direct and guaranteed public debt totaled $215bn as of end-January, up 0.8% m-o-m and 27% y-o-y.