Inflation Is Slowing Poland's Recovery
Poland’s economic recovery is coming under pressure: A protracted conflict in the Middle East could weaken demand in the eurozone—and thus hit, of all sectors, those that rely on consumer spending and exports. This is the conclusion reached in a recent analysis by Bank Pekao.
Rising energy and commodity prices are acting as a double drag on the economy. They are driving up inflation while simultaneously eroding purchasing power. Sectors such as the furniture, textile, and home appliance industries—which are heavily dependent on the European market—are particularly vulnerable. For these sectors, the hoped-for recovery could be further delayed.
Other industries are benefiting from the situation, at least in the short term. The mining sector, for example, is likely to receive a boost from higher coal prices. Parts of the chemical industry could also benefit from rising prices for raw materials and reduced competition from the Middle East.
The services sector, on the other hand, is proving more resilient. According to the report, sectors such as IT, business services, and waste management are considered comparatively crisis-proof—with stable prospects even in a tense environment.
In the more favorable scenario of a rapid easing of geopolitical tensions, service-oriented sectors in particular would benefit. Manufacturing and construction, on the other hand, would remain vulnerable to rising costs and fluctuating demand even then.
A key risk is material costs: In addition to geopolitical upheavals, increased infrastructure investments and the introduction of the Carbon Border Adjustment Mechanism (CBAM) are driving up prices for imported metals and chemical feedstocks.
Some relief could come from the labor market. Wage pressure is easing, but costs remain high, particularly for manufacturing and construction.
The government, however, is likely to have a stabilizing effect: Public investment, supported by EU funds, is gaining momentum and could make a significant contribution to growth in 2026—even if uncertainties remain high.