Title : Polish central bank forecasts inflation peaking at 18.8% in Q1 2023

Jul 12, 2022 04:10AM ET

By : AnalysisWatch

According to forecasts released by the central bank on Tuesday, inflation in Poland will peak at 18.8 percent in the first quarter of 2023 and economic growth will fall to 0.5 percent, according to forecasts.

Europe's largest emerging market economy is projected to have higher inflation and lower growth next year, in part because of the war in Ukraine, creating a headache for policymakers trying to avoid what some economists say is a risk of stagflation.

The central bank anticipates inflation of 1.5-3.5 percent.

The central bank said: "The economic outlook and CPI inflation dynamics in Poland are most dependent on the scale of the disruption to the global economy caused by Russia's military aggression against Ukraine."

The new inflation projections differ significantly from the March forecast, which predicted 11.7 percent inflation in the first quarter of 2023.

Inflation in 2022 and 2023 is now projected at 14.2% and 12.3%, respectively, up from 10.8% and 9.0% projected in March.

Gross Domestic Product (GDP) growth in the first quarter of 2023 will be 0.5%, up from a forecast of 2.1% in March. The central bank forecasts GDP growth of 4.7% in 2022 and 1.4% in 2023.

In March, the central bank projected growth of 4.4% in 2022 and 3.0% in 2023.