Polish CPI expanded 8.2% year on year in September (chart), data from Poland’s statistical office GUS showed on September 15.

The reading arrived in line with the flash estimate published by GUS in late September and confirmed the easing of inflation by 1.9pp compared to August. The CPI index remains above the National Bank of Poland’s (NBP’s) target of 1.5%-3.5% but appears on track to near the target in 2024. 

“We assume that October will bring a further significant decline in inflation, probably below 7% y/y, but in the following months, the CPI dynamics will flatten,” Santander Bank Polska said in a comment. 

The caveat to predictions of inflation falling fast is the National Bank of Poland’s cutting of its reference interest rate by 100bp to 5.75% in September and October. 

The September CPI reading suggests a further slowdown in the core inflation growth rate, which, analysts say, eased to around 10% y/y in the ninth month from 10% y/y in August.

Prices in the most-weighted food and non-alcoholic drinks segment drove the easing of the index in September, the breakdown of GUS data showed. 

Expanding 10.4% y/y in September, food price growth still eased in the sixth month after a gain of 12.7% y/y in August.

Price growth also eased in the second most-weighted segment of housing and energy, growing 9.5% y/y in September after an increase of 12% y/y in August.

The next most-weighted segment, transport, saw prices fall 2.8% y/y in the ninth month after a decrease of 1.7% y/y in August, GUS data also showed. 

Prices in culture and recreation added 8.6% in September following a gain of 10.9% y/y the preceding month.

In month-on-month terms, the CPI declined 0.4% in September after no change m/m in August.