Poland: Inflation holds steady in February
Latest reading: Inflation came in at January’s 4.9% in February, unchanged from January’s 4.9%. The reading reflected changes in the methodology used to calculate price pressures: The weights of food and housing in the consumer basket were sharply reduced, while the weights of health, recreation and transport were increased. Looking at the details of the release, transportation prices dropped in February after flatlining in the prior month, while price pressures for food plus housing and utilities picked up pace.
The trend pointed up; annual average inflation rose to 3.9% in February (January: 3.8%). Meanwhile, core inflation fell to 3.6% in February from January’s 3.7%.
Finally, consumer prices increased 0.30% from the previous month in February, following January’s 1.00% rise.
Panelist insight: ING’s Rafal Benecki and Adam Antoniak commented on the outlook for inflation and interest rates:
“[The Central Bank] President Adam Glapinski continues to present a hawkish stance but updates to the CPI weights and the inclusion of lower electricity tariffs should shift the inflation path downward in the next NBP projections. According to our forecasts, inflation returning to target should occur sooner – i.e., around the final quarter of this year rather than in 2027 as indicated by the March projection. The discussion within the MPC about rate cuts will intensify in the coming months, and the likelihood of our scenario of interest rate cuts occurring in the second half of this year (50-100bp) appears to be rising.”