5:07 1 August 2025
Inflation slowdown misses forecast
Inflation in Poland eased in July to 3.1%, returning within the National Bank of Poland’s target range (2.5% ±1 pp) for the first time in a year. However, the decline was smaller than expected, raising doubts over further rate cuts by the Monetary Policy Council (MPC). Markets had forecast inflation below 3%, anticipating the fading impact of last year’s electricity price hike and lower household gas bills. Instead, rising heating costs, higher fuel prices, and unexpectedly firm core inflation (3.4%) kept overall prices elevated.
While wages in companies rose 9.1% year-on-year in June, potentially adding price pressure, surveys show low inflation expectations among firms and consumers. GDP growth remains moderate at around 3.3%, with no investment boom in sight. Futures suggest 0.75 percentage points in cuts by year-end, though economists expect less and warn that MPC decisions remain unpredictable.
