Polish Inflation Cools, Lags EU Average as Cyprus Reports Zero Price Increase
Warsaw, Poland – Poland’s inflation rate is decelerating, positioning the country outside the bloc of EU leaders in price increases, according to recent Eurostat data. While Romania leads the EU with 8.5% inflation in August, followed by Estonia (6.2%) and Croatia (4.6%),Poland is experiencing a more moderate trend. The EU average for August stood at 2.4%.
Notably,Cyprus bucked the trend entirely,reporting zero inflation for august - meaning prices remained unchanged compared to august 2023. Italy and France also posted low figures, with 1.6% and 0.8% inflation respectively.
Analysts point to a divergence within the Polish economy, noting that service prices are increasing at a faster rate than goods prices. This is largely attributed to robust wage growth.
The recent inflation data appears to have surprised Poland’s Monetary Policy Council (MPC). Experts suggest the combination of improving inflation figures and a slowdown in wage growth in July has prompted a revision of their economic forecast for their September meeting. The MPC previously lowered interest rates by 25 basis points in early July, bringing the reference rate down to 5% from 5.25%. This followed a larger 50 basis point reduction in early May,lowering the rate from 5.75% to 5.25%.
