Freezing winter slowed economic growth

Q1 GDP growth below expectations

Flash estimate published by Statistics Poland (GUS) suggests that GDP growth slowed to 3.4% YoY in Q1 2026, from 4.1% YoY in Q4 2025, coming in below the market consensus (3.7%) and our forecast (3.9%). Seasonally-adjusted quarterly GDP growth decelerated from 1.0% QoQ in Q4 to 0.5% in Q1. The data published by the GUS is only a flash estimate. Full data including information on GDP structure will be published on 1 June.

Freezing winter slowed economic growth

In our opinion, economic growth in Q1 2026 was slowed primarily by harsh winter, which markedly hampered activity, including in the industry and the construction sector in January and February, as confirmed by monthly data published earlier (see MACROpulse of 19/02/2026 and 19/03/2026).

Regarding the demand side of the GDP, the adverse weather will likely be reflected in a slower growth in gross fixed capital formation, primarily in the infrastructure investments area. At the same time, taking into account retail sales data and the results of consumer confidence surveys, we think that consumption slowed only slightly between Q4 2025 and Q1 2026, and remained the main driver of economic growth.

Slight downside risk to our GDP growth forecast

Turning to the quarters ahead, we expect moderately fast economic growth in Poland to continue, supported by increasing absorption of EU funds under the National Recovery Plan and the Cohesion Fund. Nonetheless, following today’s weaker-than-expected data, we see a downside risk to our GDP growth forecast for 2026 (3.3%). Furthermore, an additional downside risk factor for the economic growth outlook remains the further course of the conflict in the Middle East. We will present the revised growth structure for the coming quarters after the publication of detailed Q1 GDP data.

In our view, today’s data is slightly negative for the PLN and yields on Polish bonds.