Poland’s producer price inflation jumps to 2.8% in July, dimming hopes for further National Bank of Poland rate cuts amid fiscal strain.
Poland’s producer price inflation accelerated to 2.8% year-on-year in July, up from 1.9% in June and above the 2.5% consensus. The rise reflects higher energy and commodity prices driven by renewed US-Iran tensions, with oil and gas costs climbing further in August.
Underlying inflation pressures have also intensified, with seasonally-adjusted month-on-month PPI shifting from deflationary to sharply inflationary since the Iran conflict escalated. Wage growth has similarly picked up, complicating the National Bank of Poland’s policy outlook.
Commerzbank analysts argue the data rules out further rate cuts, rendering earlier signals from NBP Governor Adam Glapinski obsolete. With fiscal plans stretched and inflation re-accelerating, the zloty faces downward pressure as the central bank adopts a cautious stance.