Inflation in Poland has entered a phase of “precise fine-tuning,” and—according to Dr. Marcin Mazurek, Chief Economist at mBank—disinflationary forces are set to dominate in 2026. In his view, improving price dynamics and a distinctly more dovish tone from the Monetary Policy Council (RPP) could pave the way for deeper interest-rate cuts than those implied by market consensus.
“We’ve been fortunate with inflation. Already in 2025 we returned to the inflation target—and even slightly below it, as December inflation came in at 2.4%. What we’re seeing now is essentially fine-tuning,”
Dr. Mazurek told the Newseria agency.
Since mid-2025, year-on-year inflation in Poland has fallen back within the permissible deviation band around the inflation target (2.5% ±1 pp.). In November it reached the target, and in December it slipped below. Moreover, contrary to economists’ concerns, core inflation excluding food and energy did not rise at the end of the year, remaining at 2.7%, its slowest pace in six years.
“Disinflationary factors clearly prevail. Food prices appear to be on a very low trajectory. When I look at snow cover, I’m quite optimistic about the start of the spring growing season, which could support low food prices. Then there’s the ‘China shock’—an influx of inexpensive Chinese goods that are readily bought. The energy shock we’d been discussing for some time has already been resolved; we know it won’t materialize. Electricity bills will be up by 2–3%, while gas bills will be lower,”
the mBank economist enumerates.
In his assessment, even potential increases in heating and water costs should not offset the impact of modest electricity price changes and falling gas prices.
Wages and Productivity: The Medium-Term Anchor
Over the medium term, the labor market and wage growth remain key for inflation. Concerns about strong pay increases have been voiced repeatedly by the RPP Chair Adam Glapiński. However, since December 2024 nominal wages in enterprises with 10 or more employees have no longer been growing at double-digit rates. Although November surprised on the upside (7.1% year-on-year versus expectations of a slowdown to 6.3%), the overall trend is clearly downward.
As Mazurek puts it, medium-term inflation can be simplified as “nominal wage growth minus labor productivity growth.”
“By year-end, wages are likely to grow by around 5–6%. Subtract productivity growth—about 3% to 3.5%—and you’re left with 2–2.5%. That makes the inflation outlook this year excellent,”
he calculates.
Scope for Further Rate Cuts
Further interest-rate cuts are also expected. In 2025, the Monetary Policy Council cut rates six times, by a cumulative 175 basis points, bringing the reference rate to 4.0%. In January, the RPP paused—as previously signaled—but economists are convinced the easing cycle is not over. Adam Glapiński has indicated a terminal rate of 3.50%, implying room for two more cuts, though market voices increasingly suggest there could be more.
“In our 2026 forecast, we assume that despite accelerating economic growth, it’s the decline in inflation—averaging around 2%—that will be sufficient to bring rates not to 3.5%, as consensus expects, but to 3.0%,”
says Dr. Mazurek.
mBank economists expect a 25 bp cut in March, followed by cuts of the same size each subsequent quarter.
Credit Activity Already Responding
According to Mazurek, the impact of rate cuts on credit activity is already visible:
“Among households, we’re seeing a clear acceleration in mortgage demand, with solid single-digit growth in PLN-denominated loan volumes. Consumer credit is also growing nicely and could reach double-digit growth soon. Corporate lending is doing very well too—we reached double-digit dynamics in November, and it looks like that’s not the final word,”
he notes.
“Borrowers would prefer lower rates, savers higher ones—but most people are neither only borrowers nor only depositors, so these forces tend to balance out.”
Global Context: Limited Spillovers to Poland
Mazurek argues that the global backdrop matters less for Poland at this stage, as the RPP—having joined the easing cycle—now conducts an autonomous policy focused on domestic inflation dynamics. In Europe, stabilization is more likely. Members of the European Central Bank have signaled no imminent rate cuts, despite inflation risks skewing to the downside.
The situation is more complex in the United States, where economic signals pointing to one or two additional 25 bp cuts intersect with tensions between President Donald Trump and Jerome Powell.
“President Trump wants a different Fed chair—one more inclined to cut rates. But it’s not that simple. For a new chair to be appointed, Powell would have to resign. Many believe that when his chairmanship ends in May, he’ll no longer be on the Board. That’s incorrect—his term as a Board member runs until 2028, and unless he resigns or that term expires, Trump cannot remove him,”
Mazurek concludes.
“Unless, of course, the current strategy of bringing criminal charges succeeds—then the situation would be clear.”
