Polish Disinflation Continues Despite Upside Surprise in January CPI

Why It Matters

The sustained disinflation supports further monetary easing, reducing borrowing costs for businesses and households. A lower policy rate could boost investment and consumer spending amid Poland’s transition to the new CPI methodology.

Key Takeaways

• January CPI fell to 2.2% YoY, below NBP target
• Gasoline prices dropped 7.1% YoY, driving disinflation
• Food inflation stayed at 2.4% YoY, offsetting price declines
• Housing energy costs rose to 3.4% YoY, slowing overall drop
• NBP may cut 25 bps in March, targeting 3.25%

Pulse Analysis

Poland’s inflation trajectory continues to tighten, but the latest flash data reveal a nuanced picture. While headline CPI slipped to 2.2% YoY, the modest upside relative to forecasts stems from persistent food price pressure and a rebound in housing‑related energy costs. The adoption of the COICOP 2018 classification reshaped the consumption basket, subtly shifting weightings and creating a temporary divergence between month‑on‑month and annual rates. Analysts view these dynamics as a transitional blip rather than a reversal of the broader disinflation trend that has characterized the Polish economy since mid‑2023.

The monetary‑policy implications are immediate. The National Bank of Poland’s governing council has signaled confidence in its inflation outlook, paving the way for a 25‑basis‑point rate cut in the March meeting. Such a move would bring the policy rate down to roughly 3.25%, easing financing conditions for corporates and households alike. Market participants are already pricing in lower yields on Polish government bonds, and the prospect of cheaper credit could stimulate capital‑intensive projects, especially in manufacturing and renewable energy sectors that have been sensitive to borrowing costs.

Beyond the domestic sphere, Poland’s inflation path influences regional dynamics within the euro‑area periphery. A credible easing cycle may reinforce expectations of a synchronized slowdown in inflation across Central and Eastern Europe, supporting a more gradual tightening stance by the European Central Bank. Investors should monitor the upcoming March CPI revision, which will incorporate updated weightings, as it will clarify whether the current disinflation momentum is sustainable and how it may affect foreign‑direct investment flows into the country.

Polish disinflation continues despite upside surprise in January CPI

13 February 2026 (Updated: 29 minutes ago)

Further disinflation despite some upward surprises

According to the flash estimate for January, Polish CPI inflation declined to 2.2 % YoY (ING and market consensus at 1.9 % YoY) from 2.4 % YoY posted in December. That means that for the second consecutive month, headline inflation was below the National Bank of Poland (NBP) target of 2.5 % (± 1 percentage point).

Further disinflation was mainly driven by a decline in gasoline prices, and fuel fell 7.1 % YoY after a decline of 3.1 % YoY in December. We see three main reasons why inflation did not drop as much as expected:

1. Food prices surprised to the upside and increased by 2.4 % YoY, i.e., at the same annual rate as in the previous month.

2. Housing energy costs accelerated to 3.4 % YoY from 2.8 % YoY in December despite lower gas bills.

3. The shift to COICOP 2018, the updated global standard for classifying goods and services that households consume, probably also contributed to the lower annual figure and helps explain the discrepancy between a 0.6 % MoM increase that implies a 1.9–2.0 % YoY increase and the official 2.2 % YoY number.

Although the January flash figure was based on the same basket weights of particular items as in 2025, some items were moved from one category to the other, shifting relative weights and changing aggregation. On a positive note, the MoM change of 0.6 % was in line with our forecasts, even though the annual figure was 0.3 pp higher.

The January CPI report is of a preliminary nature. It incorporates the new COICOP 2018 classification, but still uses the same weights as in 2025. The figure will be revised in March when Statistics Poland conducts an annual update of CPI weights.

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Disinflationary trend justifies further rate cuts

Despite the upward surprise in the annual January CPI inflation, the overall picture of price developments is positive, and disinflationary trends are deeply rooted. That is why we see room for further monetary‑policy easing. Recent official statements from the Monetary Policy Council suggest that a 25 bp rate cut in March is a done deal.

We believe that the March NBP macroeconomic projection will paint a much more favourable picture of the inflation outlook than the one presented in December. As a result, the target rate may be lower than the 3.50 % often mentioned by policymakers in recent weeks. In our view, the main policy rate may fall to 3.25 % or even lower before the end of the year.

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