Poland's interest rates down to 4.0 percent by end-2026 - OECD
Poland's monetary policy is assumed to ease further gradually this year and next, with the interest rates falling to 4.0 percent by the end of 2026, according to the newest edition of the Economic Outlook report by the Organisation for Economic Co-operation and Development OECD.
"Excise tax increases this year and again in 2026, together with the planned lifting of the electricity price cap in
September, will put upward pressure on prices, but inflation is expected to return to target in the second half of 2025," OECD wrote in the report.
"Monetary policy is assumed to ease further gradually this year and next, with policy rates moving towards 4 percent by the end of 2026, as inflationary pressures subside," it added.
According to the economists, Poland's planned multi-annual fiscal consolidation will weigh on growth, with higher income tax revenues due to ‘bracket creep’ and a nominal freeze of some family benefits. As they pointed out, it will need to accommodate increased defence spending, which is set to rise from the current 4.7 percent to 5 percent of GDP next year.
The OECD assessed that overall, the fiscal stance is expected to tighten by 0.6 percent of GDP in 2025-26.
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