Inflation stabilised in February
In accordance with the data published by Statistics Poland (GUS), CPI inflation did not change between January and February, printing at 2.1% YoY, in line with market consensus and our forecast. In the preliminary estimate published in February, the January inflation was pencilled in at 2.2%, which means that changes to inflation basket weights (see below) brought a slight downward adjustment of the January inflation figures.
Core inflation still close to the MPC’s inflation target
Food and non-alcoholic beverage price growth rate did not change between January and February, staying at 2.4% YoY, which was consistent with our expectations. Inflation stabilised as a result of a slower growth in the prices of meat (primarily poultry) and dairy products (with a broad-based drop reported for both milk products and eggs) and a stronger growth in the prices of fruits and vegetables, though for both of them the acceleration was driven by higher prices of fresh products, i.e. mostly imported ones. Particularly noteworthy about the February inflation data breakdown is a substantial drop in the annual price growth in the “recreation, sports and culture” category, to 2.4% YoY in February vs. 4.3% in January, which in turn slowed the total price growth by 0.1 pp. Inflation decline in this category was largely connected with a marked price growth slowdown in “other equipment and recreational articles” and “package holidays” (both in Poland and abroad) categories. In our view, the slowdown, which was also facilitated by the PLN appreciation, will not last long due to the outbreak of war in Iran. The war will most likely disrupt the supply chains and increase the costs of transport, which will be boosted further by the PLN depreciation. Consequently, the pressures on growth in prices of imported goods and package holidays in Poland and abroad will increase, driving the core inflation excluding the prices of food and energy up in the coming months. In accordance with our estimates, core inflation stood at approx. 2.6% YoY in February, which was close to the target set by the Monetary Policy Council (2.5%) and the January level.
Slight weight changes in the consumer basket
Statistics Poland have also published revised weights applied to the consumer basket, which reflect the structure of expenses from household budgets in 2025. In 2025, the share of expenses on food and non-alcoholic beverages in households’ overall expenses went slightly up (25.91% vs. 25.85% in 2024). Notably, price growth in that category in 2025 was markedly slower than growth in wages in the national economy. Consequently, once the share of expenses on foods in the structure of households’ expenses has grown, this means that the households were buying upscale products, meaning that the Polish society is becoming wealthier. Weights in the consumer basket were adjusted only slightly in most categories. In absolute terms, the biggest change took place in the “transportation” category, with weight going down from 11.07% to 10.18%, driven by the drop in prices of fuels seen in 2025. A significant change in weight was also seen in the “housing, water, electricity, gas and other fuels” category (up from 19.53% to 20.35%). In 2025, price growth in that category ran markedly above the headline inflation, which contributed to a substantial increase in that group’s weight in the consumer basket amidst poor price elasticity of demand on goods and services.
Upside risk to inflation forecast due to war in Iran
Even though inflation stabilised in February just as we anticipated, the starting point for the forecast inflation trajectory went markedly up, mainly due to the growth in prices of fuels seen in March in the wake of the outbreak of war in Iran and the growing tensions in the Middle East. This is indicative of a substantial upside risk to our average annual inflation forecast for 2026 (2.2%). The forecast needs to have a new scenario now for energy commodity prices, PLN depreciation vs. USD & EUR, and secondary, lagged inflation effects arising from the growing production costs, which are conducive to a transitional increase in core inflation. The revised inflation trajectory must also reflect the anticipated stronger growth in the prices of foods connected with a strong increase in the prices of natural gas. Higher prices of gas will drive up the prices of fertilisers, which in turn will boost the costs of crop and livestock production. Our revised macroeconomic scenario covering the GDP growth, inflation, interest rates and PLN trajectory forecast will be presented in our MACROmap of 23/03/2026.
Today’s data on inflation in January and February are neutral for the PLN and yields on Polish bonds.
