Polish headline inflation likely to have eased in October

Polish headline inflation data for the month of October is set to be released this week. According to an Erste Group Research, the consumer price inflation is likely to be affirmed at 1.7 percent year-on-year in the month of October. Easing of inflation is driven mainly by the lower growth dynamics of food prices.

“We expect this trend to continue toward the end of the year. Next year, though, we would see the inflation rate coming back to above 2 percent already in the first half of the year”, stated Erste Group Research.

The size of the recovery will solidly depend on the increase in energy prices for households. This continues to be the biggest risk to the inflation forecast for next year, which currently stands at 2.2 percent. This is much beyond the 3.3 percent forecast given by the MPC last week, added Erste Group Research.