Poland Macro Weekly: 0% probability of a rate cut in 2024

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  • Consumers drive growth in the CEE, investment in retreat (p. 2) – 1q24 belonged to the consumers in the CEE, as private consumption was the main driver of growth amid solid real income growth. Investment was dragged down by the transition to new EU financial framework.


  • The MPC kept NBP interest rates unchanged as expected, with the reference rate at 5.75%. Press release suggested a decrease in uncertainty related to the impact of regulatory changes on energy prices. The assessment of current inflation developments remained unchanged, but rather favourable - despite the noticeable economic recovery, the MPC stated that demand and cost pressure remain at a low level with a limited effect on inflation. However, the MPC still fears that inflation will rebound and focuses on risks, such as strong growth of wages. Governor Glapinski stated that the probability of rate cuts in 2024 is zero, while he hopes that conditions will be met to trim rates in 2h25. We still see a chance for a small rate cut in late 2024 in case of excessive appreciation of the zloty, but the proper rate cuts cycle will only start in 2025.
  • CPI inflation in May increased to 2.5% y/y, below consensus of 2.8% and our close to our estimate at 2.6%. Deceleration of food prices growth (y/y) partly neutralized higher annual growth rate of energy carriers and fuel. We estimate that core inflation in May declined to 3.9% y/y, stronger than expected, which points to weakening of underlying inflationary pressures.
  • Manufacturing PMI for May disappointed, falling to 45.0pts from 45.9pts in April. However, one should remember that already for a number of years PMI has been weaker proxy of actual trends in manufacturing that alternative indicators (GUS, ESI), so we believe that it overestimates the scale of the downturn.


  • Only the second half of the week will bring some domestic macro figures: current account for April (we expect the first monthly deficit this year) and detailed CPI data for May.


  • 0% – probability of an interest rate cut in 2024 according to NBP governor.

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