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Inflation in Poland – March 2023. Paweł Borys, head of PFR, guest of Konrad Piasecki

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It is not that we will immediately see a return to 2.5 percent, i.e. to the inflation target of the National Bank of Poland, said Paweł Borys, president of the Polish Development Fund, in the “Rozmowa Piaseckiego” program on TVN24. He stated that “combating inflation will take two or three years.” According to him, the process of disinflation, i.e. slower price growth, is to begin in March.

According to data from the Central Statistical Office price increase in February 2023 increased to 18.4 percent Every year. Last time inflation exceeded the mark of 18 percent on an annualized basis in December 1996.

– More than half, almost 2/3 of inflation results from aggressive actions Russia, first the destabilization of the European energy market, then the war, which caused a spike in food prices. This was the initial impetus for the price jump. However, this was followed by the so-called second-round effects, i.e. wages began to increase, which translated into core inflation. In February, we had the peak of inflation, now we are moving to disinflation, so inflation at the end of the year will reach 7 percent, Borys said on TVN24.

Fighting inflation

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– The whole world is facing an initial inflation shock, first caused by the pandemic, then caused by Putin. What we are seeing now is the secondary effects of what Putin initially caused.

According to the head of the PFR, “it will take us two or three years to fight inflation”. It’s not like we’re going to see a return to 2.5% right away. (NBP objective – ed.) – he emphasized.

As he said, “this week we end the worst economic quarter in this cycle.” – We have the weakest growth because we have an economic slowdown and the highest inflation. From the second quarter we should see lower inflation and faster growth.

When asked if the inflation peak is already behind us, he replied: “I said that I would give my hand that inflation would fall in March. So I will be watching these data very closely.”

Main photo source: TVN24

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