Polish rate hike odds are rising but policymakers are in no rush

Key arguments

• September inflation exceeded the NBP's 2.5% ±1pp tolerance band, but the governor expects a return to range in October.
• Energy accounted for 60% of September inflation, with limited pass-through to other prices and no signs of second-round effects.
• Domestic risks include solid consumer demand, ~6% YoY corporate wage growth, rising global agricultural prices, expansionary fiscal policy and strong PPI.
• Temporary fuel excise and VAT cuts are expected to remain in place until end-2026; a November hike is not currently seen as necessary but is not ruled out.

Corresponding source evidence

1. The central bank appears willing to wait to raise rates In today's press conference, National Bank of Poland Governor Glapiński acknowledged higher inflation but seems willing to wait to raise interest rates During his October press conference, National Bank of Poland (NBP) Governor Adam Glapiński highlighted growing risks to the inflation outlook.
2. Global sources of inflation Explaining the rationale behind the October decision to leave interest rates unchanged, NBP Governor Adam Glapiński stressed that the global economy is facing an energy shock resulting from the conflict in the Middle East.
3. Local inflationary factors are in play In the governor's view, the inflation outlook is subject to greater uncertainty due to the geopolitical tensions.