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Polish inflation re-accelerates, hurting zloty as NBP rate-cut signals fade

July inflation accelerated, with passenger fuel prices rising 13.9% month over month, pushing annual fuel inflation to 15.8% while core measures also moved higher.

Reported · Written up by our desk · Major Pairs

Commerzbank, via analyst Tatha Ghose, said Poland’s headline and core inflation have re-accelerated, with seasonally adjusted monthly rates now clearly above target.

The firm pointed to July CPI inflation rising to 3.0% year over year from 2.5% in June, driven largely by a 13.9% month over month jump in passenger fuel prices, which lifted annual fuel inflation to 15.8% from 5.3% in June.

Commerzbank added that core inflation excluding food, drinks, fuel and energy climbed to 3.1% year over year from 3.0% in June, and while the 15% trimmed mean was steady at 2.8%, other core measures accelerated, including an index excluding regulated prices.

With inflation rising faster than the central bank is turning hawkish, Commerzbank said earlier signals from National Bank of Poland Governor Adam Glapinski about possible rate cuts should be treated as obsolete, a development seen as negative for the Polish zloty (PLN).

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