Economic news

• INTEREST RATES: Two MPC members went on the wires last week. Marcin Zarzecki would like to resume cutting rates if the March projection confirms that current disinflation is sustainable. For him, it is too early to weigh in on February meeting. Iwona Duda already considers it sustainable and expects the Council to cut rates in February or March. Governor Glapinski’s press conference already pointed us in that direction and other MPC member confirm that the Council will likely cut rates in February.
• INDUSTRY: Industrial output accelerated from -1.1% yoy in November to +7.3% yoy in December, beating the consensus handily (+3% yoy). Industrial output data exhibited a lot of volatility in recent months, which warrants some caution in interpreting December’s print. One additional working day certainly helped, but it i salso true that the fundamentals are improving. At the same time, cost pressures are falling as the PPI surprised to the downside and deepened its decline (from -2.4 to -2.5% yoy). A more detailed comment on industrial output  can be found here.
• CONSTRUCTION: Construction output data also surprised in December, in similar direction and scale as industrial output. Construction activity expanded by 4.5% yoy, while consensus assumed stagnation in this timeframe. The acceleration is likely to be associated with improving demand for infrastructure and specialized construction works. It was also facilitated by very favorable weather conditions (January will see a major reversal on that front, though). The full comment can be read here.
• RETAIL SALES: Retail sales rose by 5.3% yoy in December, matching expectations. There are some subtle signs that the print is a bit stronger than the headline would suggest: durable goods sales came out above our expectations, as did certain discretionary items (e.g. books, newspaper and other specialized stores), while food sales disappointed. Nevertheless, this figure does not change our nowcasts of 25’q4 and 2025 GDP. We will send out a more detailed comment later.
• LABOR MARKET: Average corporate wage expanded by a whopping 8.6% yoy in December, which is a major surprise vis-à-vis forecasts (ca. 7% yoy). Before jumping into conclusions, one should remember that December is a volatile month due to various bonus payments. Wage pressures have been falling consistently (and across different metrics), which suggests that the December print needs to be put in the proper context. The labor market itself is in mediocre condition, as evidenced by employment data. Last December saw a decline in headcounts of 10 ths., the most since 2013. Overall, in 2025 corporate employment declined by 45 thousand (-0.7%). The detailed analysis of latest labor market data is here.
• DEBT: The Ministry of Finance sold POLGBs of six series, with the total value of PLN bn and attracted PLN 17.2 bn in demand. This is how a typical POLGB auction looks like these days, with total sales falling in the upper range of the target supply (PLN 8-12 bn). The demand for PLN government bonds remains solid. At the same time, Eurostat informed that general government deficyt declined from 8.5% in Q2 to 5.8% of GDP in Q3 (note that this data is not seasonally adjusted). General government debt remained unchanged at 56% of GDP.
• SENTIMENT: Corporate sentyment improved considerably at the turn of the year, Statistics Poland survey showed – sentiment indices rose for all major sectors and the weighted average matched a 6-year high. Consumer sentiment rose slightly. We dig deeper into the data in the following section. Today the NBP published the results of its quarterly enterprise survey. It is a little more upbeat on general situation, corporate finances and investment, but points to declining wage and cost pressures.

Polish corporations entered 2026 in upbeat mode

Yesterday's data package from the Polish economy has already provided us with material for two publications (labor market: link, industrial and construction production: link). It is time to address what we learned yesterday not about the performance of the Polish economy in December, but about the mood of Polish companies and households in January.

In terms of consumer confidence, sentiment has not changed significantly since the end of last year. Sentiment is currently better than the average for 2025, but worse than in September and June. Interestingly, this is not due to a lower propensity to buy, as this is on a fairly steep upward trend, but to greater pessimism about the situation in the country and, above all, heightened concerns about the state of the labor market. This is not a problem that has arisen in recent months. Since 2024, assessments of the personal and national situation have been on a slight downward trend, while the subjective threatof unemployment has been rising slightly. 

Consumer confidence – selected indicators (pts., nsa)

Source: Pekao Research, Statistics Poland

While we have seen significant movements in consumer sentiment indices, business sentiment indicators spent most of the 2024-25 period within a very narrow range. However you look at it, the recovery in business sentiment was incomplete. However, 2026 started very well, with sentiment in most sectors rising to its highest levels in several years. Calculated as a weighted average of sectoral business climate indicators, the index basically matched the levels of 2021. The path to overcoming post-COVID weakness is therefore open. Interestingly, this is not the first time that business sentiment has changed dramatically at the turn of the year – similar situations occurred in 2017, 2018, and 2019, among others. We cannot therefore rule out that the annual change in the sample of entities comprising the enterprise sector (ES) played a certain role. The same effect causes annual discontinuities in employment dynamics in the ES. Nevertheless, business sentiment generally correlates well with economic growth, for example, and the significance of this effect may simply not be great.

Business sentiment (industry average, sa)

Source: Pekao Research, Statistics Poland

The improvement in business sentiment at the beginning of the year is another argument for accelerated economic growth this year. We expect GDP growth to reach 4% this year thanks to solid consumption, catching up on public investment, and a slow recovery in exports.

Financial market update

The abundant macroeconomic data published by the Central Statistical Office (GUS) last week did not affect domestic asset markets. In particular, EURPLN returned to a comfortable level of around 4.21, and 10Y POLGB yields remained well anchored at around 5.125. The only significant movement recently took place on the FX market and concerned the USDPLN, which followed the weakening dollar downwards; as a result, USDPLN rebounded from support at 3.55 and is currently only just slightly above that level. In general, last week on the Polish markets allows for quite some optimism; it turns out that even in a period of considerable geopolitical turmoil (cf. the dispute over Greenland, or tensions in Davos), investors have trust in Polish assets. After all, last week we did not see any depreciation of the PLN or a sell-off of POLGBs, and the WSE did not turn red. Therefore, we are optimistic about the coming week, hoping that the increase in risk aversion in the core markets and investors' search for so-called safe havens will not have an excessive impact on Polish asset prices.