Republic of Poland: 2025 Article IV Consultation-Press Release; and Staff Report

The 2025 Article IV Consultation discusses that Poland has maintained rapid growth, albeit partly at the cost of a sharp rise in fiscal imbalances. Recent growth has been driven primarily by strong private consumption, supported by a solid rebound in real wages. Fiscal stimulus in recent years has also contributed, although these expansionary forces have been partly offset by appropriately tight monetary policy, which has weighed on private investment. Disinflation is progressing as expected, creating room for gradual monetary policy normalization. The near‑term outlook is favorable, with growth projected to accelerate to 3.5 percent in 2026, supported by a significant inflow of EU funds and the easing of monetary conditions. As the output gap closes in 2026, inflation is expected to stabilize near the midpoint of the target range. Ensuring public debt sustainability will require faster fiscal consolidation; staff recommend a cumulative adjustment of at least 4 percent of GDP by 2030—double the authorities’ current plans. Sustained income convergence will also depend on structural reforms, particularly to boost innovation amid slowing productivity gains and rising demographic pressures.