Poland’s GDP growth of 3.80% YoY in December 2025 marks a steady acceleration from the 3.30% growth in November and outpaces the 12-month average of approximately 3.30%. This positive momentum reflects resilience amid global uncertainties and domestic policy adjustments. The geographic scope focuses on Poland’s economy, while the temporal scope covers the latest monthly release and its historical context over 2025.

Drivers this month

• Strong industrial output and export growth contributed roughly 0.90 percentage points (pp) to GDP.
• Private consumption added 1.20 pp, supported by rising wages and stable employment.
• Government spending contributed 0.50 pp, reflecting ongoing infrastructure investments.
• Net exports added 0.20 pp, aided by a weaker PLN boosting competitiveness.
• Inventory accumulation subtracted 0.10 pp, indicating cautious business sentiment.

Policy pulse

The 3.80% GDP growth exceeds the National Bank of Poland’s inflation target zone, suggesting the economy is expanding at a pace that could sustain moderate inflationary pressures. The central bank’s current policy stance remains cautiously accommodative, with interest rates steady at 5.50%, balancing growth and inflation risks.

Market lens

Immediate reaction: The PLN appreciated 0.30% against the euro within the first hour post-release, while 2-year government bond yields rose 8 basis points, reflecting increased growth optimism. Breakeven inflation rates edged up 5 basis points, signaling modest inflation expectations.

Core macroeconomic indicators underpinning Poland’s GDP growth include industrial production, labor market conditions, inflation, and trade balances. Industrial output grew 4.10% YoY in November, up from 3.70% the prior month, driven by manufacturing and energy sectors. Unemployment held steady at 5.20%, near historic lows, supporting consumer spending.

Monetary Policy & Financial Conditions

The National Bank of Poland’s steady policy rate at 5.50% reflects a cautious approach amid inflation running at 4.30% YoY, slightly above the 2.50% target. Financial conditions remain moderately tight, with credit growth slowing to 3.50% YoY, indicating restrained lending amid global uncertainties.

Fiscal Policy & Government Budget

Fiscal policy remains expansionary, with the government maintaining a 3.80% of GDP deficit target for 2025. Infrastructure and social spending continue to support growth, offsetting external headwinds. Public debt stands at 47% of GDP, manageable within EU fiscal frameworks.

External Shocks & Geopolitical Risks

Poland faces moderate risks from supply chain disruptions and regional geopolitical tensions, particularly related to Eastern Europe. However, diversified trade partners and energy supply adjustments mitigate immediate shocks.

Drivers this month

• Industrial production growth accelerated from 3.70% to 4.10% YoY.
• Private consumption rose 1.20 pp, the strongest contributor since mid-2025.
• Government investment spending increased by 0.30 pp compared to October.

Policy pulse

GDP growth above 3.50% supports the central bank’s current cautious stance. Inflation remains contained but requires monitoring as wage growth and demand pressures build.

Market lens

Immediate reaction: PLN/USD strengthened 0.25% post-release, while 2-year yields climbed 8 basis points, reflecting market confidence in Poland’s growth trajectory.

Looking ahead, Poland’s GDP growth faces a mix of supportive and challenging factors. The baseline forecast anticipates 3.50–4.00% YoY growth in Q1 2026, driven by sustained consumption and export demand. However, inflationary pressures and external shocks could temper momentum.

Bullish scenario (30% probability)

• Global trade recovers faster than expected, boosting exports by 5% YoY.
• Monetary policy remains accommodative, supporting credit growth above 4%.
• Fiscal stimulus accelerates infrastructure projects, adding 0.50 pp to growth.

Base scenario (50% probability)

• Moderate export growth of 2–3% YoY amid stable global demand.
• Monetary policy steady, inflation contained near 4%.
• Fiscal deficit maintained at 3.80% of GDP, supporting steady investment.

Bearish scenario (20% probability)

• Geopolitical tensions disrupt supply chains, reducing exports by 2%.
• Inflation spikes above 5%, prompting monetary tightening.
• Fiscal consolidation slows government spending, subtracting 0.30 pp from growth.

Poland’s 3.80% GDP YoY growth in December 2025 signals a resilient economy navigating global uncertainties with steady domestic demand and supportive fiscal policy. While inflation and geopolitical risks warrant vigilance, the overall outlook remains constructive. Market reactions underscore confidence, with the PLN and bond yields reflecting optimism. Continued monitoring of monetary policy and external developments will be key to sustaining growth momentum into 2026.

Indicator vs. PLNUSD Since 2020

Since 2020, Poland’s GDP growth and the PLNUSD exchange rate have shown a positive correlation. Periods of accelerating GDP growth often coincide with PLN appreciation against the USD, reflecting improved investor confidence. For example, the 2023 growth rebound from 2.50% to 3.50% YoY aligned with a 7% PLNUSD appreciation. This relationship underscores the importance of GDP data in currency market dynamics.