Polish consumers voted with their wallets in March, but sentiment is deteriorating
Although retail sales were not as exuberant as we had anticipated (our forecast: +10% yoy), the March result (+8.7% yoy) exceeded consensus forecasts by a wide margin (3 pp.). Polish economy started the quarter in winter-related doldrums but ended it at a very high pace. In March, one-off and transitory factors boosted retail sales, just as we expected, but this feat will not be repeated. Therefore, the most recent retail sales print is not a good measure of the strength of the Polish consumer.
Retail sales (constant prices, yoy)
Source: Macrobond
The March increase in retail sales is the highest in this cycle and the highest in 4 years. What contributed to such a strong result?
- A relatively early Easter (April 5th), which boosted food sales. Nevertheless, the increase in this category was clearly (by about 6 pp.) lower than we had assumed. Had our assumptions materialised, the overall sales growth would have been double-digit. Since some of the pre-Easter sales likely took place in April, this should smooth out the Easter fluctuations in this category somewhat.
- Stockpiling fuel in fear of price increases after the outbreak of war in the Persian Gulf. It can be roughly estimated that this effect added about 10 pp. to fuel sales growth – thus, the Gulf war boosted sales half as much as the war in Ukraine.
- Working days (+1 yoy) and trading days (shopping Sunday in March rather than April), which gave consumers plenty of time for shopping.
- The end of winter and the arrival of spring, which boosted seasonal sales in many categories, mainly clothing and footwear (acceleration from 0.8 to 13.6% yoy), but also durable goods of a recreational nature.
- Continued recovery in car sales after a weak (tax reasons) start to the year – here we saw an acceleration from 2.7 to 7.7% yoy.
A low base from the previous month – in some categories (clothing and footwear, press and books, pharmaceuticals and cosmetics), February 2026 was one of the weakest or the weakest Februarys in history.
Retail sales by category (constant prices, % yoy)
Source: Macrobond
Most of these factors are one-off or temporary. Therefore, April's sales will be much weaker, possibly even around 0-1% yoy. Neither March nor April sales will be good indicators of the condition of the Polish consumer. To measure their pulse, we need to take a step back and adopt a slightly more holistic approach. We know that 2026 is bringing a slowdown in real household incomes due to lower nominal growth and an inflation surprise triggered by the Gulf war. In our opinion, this will reduce the dynamics of private consumption from 3.7 to 3.2% (annual average), and this will be the main channel through which the Gulf War will impact on the Polish economy. The first signs of this is already visible in household sentiment data, which has recently fallen by 4-5 points, thereby nullifying the improvement observed in the second half of last year. So while consumers voted with their wallets in March, their declarations already show greater restraint going forward.
Consumer sentiment indicators from GUS
Source: Macrobond
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