Prolonged conflict in Iran could weaken demand in the Eurozone and hold back a recovery in Poland’s consumer-focused industries in 2026, a report by Bank Pekao said on March 16.

Higher commodity prices are expected to push up inflation, slow consumption and exports, and weigh on sectors strongly tied to EU markets. Producers of household appliances, furniture and textiles may therefore fail to see the long-awaited rebound next year, the report said.

Mining could temporarily benefit from higher commodity prices, including hard coal, while some segments of the chemicals sector may gain from reduced competition from the Middle East and rising prices of intermediate goods.

Business services, information and communication, and waste management were identified as relatively resilient, with moderately favourable prospects despite the crisis.

In a baseline scenario assuming a swift easing of tensions in the Middle East, service sectors such as accommodation and food services, information and communication, and business services are expected to perform best.

Industrial processing and construction, despite an anticipated improvement in conditions, are likely to remain the most exposed to cost and demand shocks even under this scenario.

Rising material costs could pose a major challenge for companies this year, driven not only by the conflict in the Persian Gulf but also by increased infrastructure investment and the implementation of the CBAM border tax, which is expected to raise prices of imported metal and chemical intermediates from outside the EU.

Labour costs, by contrast, are expected to ease as wage pressure weakens, although they will remain a significant challenge, particularly in manufacturing and construction.

Public investment, supported by EU funding and already showing signs of recovery, is expected to provide a positive growth impulse in 2026 and is likely to remain relatively resilient to current developments.