According to the estimates prepared for the European Commission (EC) inflation in 2023 in Poland will amount to 7.3% on an annual basis. This means that the level of price increases in Poland next year will be the highest in the entire European Union.

According to the spring forecast of the European Commission, the average annual HICP inflation in Poland in 2022 will amount to 11.6% (year- to- year). Lithuania, Bulgaria and the Czech Republic will have higher inflation in 2022 (12.5%, 11.9% and 11.7% respectively). HICP inflation (Harmonized Index of Consumer Prices) is a harmonized index of consumer prices, calculated on the basis of a unified methodology by the Member States of the European Union.

In 2023, although inflation in Poland will drop by as much as 4.3 %- to the level of 7.3% on an annual basis, Poland will be the country with the highest level of price growth in Europe. This is pointed out by the economists of the PKO BP bank, who have prepared a summary of the EC’s forecasts for individual countries. In their opinion, the European Commission study indicates that rising commodity prices, growing demand and supply-side bottlenecks have contributed to a steady and significant increase in HICP inflation in Poland in recent months.

The EC expects that the wage expectations of Polish workers and disruptions in supply chains will also affect the level of core inflation in Poland, especially in 2022. Therefore, the high rate of price growth will continue in Poland also after the easing of the factors related to the outbreak of the war – hence in 2023 inflation in Poland is to remain high.

According to the Commission’s analysts, the inflation peak is to take place in the third quarter of 2022 (July-September), and the high increase in prices will not be without impact on the Polish economy.

Due to inflationary pressure, as well as uncertainty in the markets in connection with the war, disruptions in supply chains and the NBP’s monetary policy responding to inflation will limit GDP growth, the Commission forecasts.

According to the calculations of EC experts, economic growth in Poland is to slow down to 3.7% and 3.0% in 2022 and 2023 respectively. The moods of investors and consumers are also contribute to this.

Arkadiusz Słomczyński order