The full version of the report is available here.

Slight acceleration in economic growth

The investment recovery has been deferred to 2026; however, this delay will only amplify the accumulation of investment projects in the pipeline. Driven primarily by the public sector, investment growth is projected to accelerate to 9.7% in 2026. Private consumption is expected to expand at a similar, albeit slightly slower, pace than in 2025, largely reflecting a somewhat weaker increase in household incomes. Finally, a further gradual improvement in external demand should be anticipated. Altogether, these factors are expected to translate into GDP growth of around 4%.

GDP growth and its components, % y/y

Sources: Statistics Poland, Pekao Research

How are the risks to this forecast distributed? On the upside, an outcome stronger than the projected 4% would not come as a surprise if external demand turns out to be more robust or if private consumption proves less sensitive to current income dynamics and more responsive to interest rates and credit conditions.
That said, this year’s investment upswing comes at a cost. Some of the projects implemented in 2026 will not be continued into the following year, and in certain areas—most notably road infrastructure—investment activity should be expected to decline in 2027. As a result, 2027 is likely to resemble 2025 more than 2026. We therefore expect GDP growth to decelerate to 3.7% in 2027.

Inflation below 2%

In the short term, a further decline in inflation remains the baseline scenario. We expect average annual inflation to amount to 1.9% in 2026. The continued disinflation will be driven by low food prices, a sharp deceleration in energy prices, further disinflation in services—reflecting labour market easing and the normalisation of wage growth over the past two years—as well as increased inflows of low-cost goods from China. There are also no signs of rising inflationary pressure in the expectations of firms and households, nor in  PPI–CPI relationship, which we closely monitor.

Headline and core inflation, % y/y

Sources: Statistics Poland, National Bank of Poland, Pekao Research

However, disinflation will not last indefinitely—the disinflationary impact of interest rate hikes is expected to be offset in the second half of the year by the inflationary effects of rate cuts. It is when a turning point in core inflation and the trough in overall inflation should emerge. We expect core inflation to stabilise around 2.2%. In 2027, inflation is likely to rise slightly, driven by base effects and the normalisation of food and fuel price growth rate.

NBP reference rate at 3.25%

The Monetary Policy Council is currently in an easing cycle and has not yet delivered its final move. We expect that the prospects of further declining inflation will prompt Council members to implement three additional rate cuts (the first of which is expected in March). As a result, the reference rate is likely to stabilise at 3.25%.
 

NBP reference rate vs. expectations, % 
 

Soruces: NBP, Bloomberg, Pekao Research

Why not more cuts? While we are confident that inflation will decline faster and more sharply than the consensus expects, the window for further rate reductions is limited. By mid-year, the disinflationary impact of previous rate hikes will begin to be offset by the inflationary effects of rate cuts, and core inflation will approach its trough.

Further decline in wage growth

The labour market has loosened in recent years, and it seems that some observers of the Polish economy have not fully processed all the implications of this development. While job cuts have been modest and the rise in unemployment largely driven by regulatory factors, the Polish labour market—when viewed through a broad set of “soft” indicators, including hiring plans, the number of vacancies and job postings, and projected wage increases—has effectively rolled back by approximately 9–10 years. The significant reduction in workers’ bargaining power will contribute to further moderation in wage growth in Poland. In our view, average wage growth is expected to decline to 5.5% in 2026. Real household incomes—and consequently private consumption—will be supported in this environment by a continued decline in inflation.

Average wage in the enterprise sector, % y/y
 

Soruces: Statistics Poland, Pekao Research

What else to expect in 2026?

In this publication, we pose the key questions for 2026 and provide clear answers. Readers can expect a substantive and intellectually stimulating analysis. Will the AI bubble burst—and with what consequences? What lies ahead for Europe’s competitiveness? How likely is the materialization of a Romanian-style scenario in Poland? Will the Chinese dragon end up devouring its own tail? What would peace in Ukraine change—assuming it becomes a reality? We invite you to explore our answers to these and other questions.

1. Will the global economy accelerate? Yes.
2. Will Europe emerge from stagnation? No, but…
3. Is AI a speculative bubble? Yes, but...
4. Will China be the winner of the trade wars? No, but…
5. How far will wage growth decelerate in Poland? 5.5%
6. Is the Polish economy at risk of overheating? No.
7. Will there be an investment cliff in 2027? No.
8. How low can inflation go in 2026? 1.9%
9. Is Poland vulnerable to a Romanian-style crisis? No.
10. What would peace in Ukraine change? Not much.