Polish CPI expanded 4.6% year on year in November, 0.1pp below the consensus, Poland’s statistical office GUS said in a flash estimate on November 29 (chart).

The reading also is 0.4pp less than the official measure of October inflation, which GUS published in mid-November. Price growth in Poland is expected to hover around 5% by the end of the year, preventing a dovish pivot from the National Bank of Poland (NBP) until around mid-2025, analysts say.

The November easing of the inflation indicator is temporary and owes largely to statistical effects from last year, particularly in the fuels segment. 

Meanwhile, core inflation – price growth without food and energy – increased to an estimated 4.2% y/y-4.3% y/y in November. Core inflation came in at 4.1% y/y in October, the NBP said in mid-November.

Poland’s inflation outlook expects the CPI to peak in early 2025 before returning to target levels later that year.

“Inflation should peak at slightly above 5% y/y in the first quarter, returning to the broadly defined inflation target of 2.5% y/y give or take 1pp in Q3,” PKO BP said.

That means the National Bank of Poland (NBP) is unlikely to begin a new easing cycle before the mid-point of 2025, even though some on the NBP’s rate-setting council do hint at a right moment coming possibly as soon as March. 

“We expect the first rate cut to occur in the second quarter, once the NBP is confident that the inflation trend has reversed and is heading toward the central bank's target. In 2025, NBP interest rates may be reduced by approximately 100bp in total,” ING said.

The NBP's reference interest rate is now at 5.75%.

Prices of food and non-alcoholic drinks grew 4.8% y/y in November, easing from a gain of 4.9% y/y in October, the breakdown of the data showed.

Energy prices expanded 11.7% y/y in the eleventh month, following an increase of 11.5% y/y in October. 

Fuel prices fell 6% y/y in November, compared to no change y/y the preceding month, GUS data also showed.

In month-on-month terms, the CPI added 0.4% in November after growing 0.3% m/m the preceding month. Prices of food grew 0.7% m/m while energy prices expanded remained unchanged m/m. Fuel prices, meanwhile, expanded 2.3% m/m.