The Monetary Policy Council decided to cut interest rates, triggering an immediate reaction on currency and stock markets. This decision comes at a time when Polish retail sales are booming against the backdrop of a weakening eurozone, and the real estate market is grappling with a drastic drop in developer supply. Investors are anxiously watching the złoty weaken against the dollar, awaiting a speech by NBP President Adam Glapiński.

Interest Rate Cut by the MPC

The Council decided to reduce the cost of money, which weakened the złoty's exchange rate against the dollar and euro, while stimulating demand for variable-rate loans.

Housing Supply Crisis

The number of units available from developers fell by nearly 60 percent, which, combined with high demand, is putting pressure on record increases in price per square meter.

Poland as a Trade Leader

Retail sales data for January indicate dynamic consumption growth in Poland, distinguishing the country against the backdrop of stagnation in other EU states.

The Monetary Policy Council's decision to lower interest rates became the main point of reference for the Polish economy in March 2026. While this move is intended to provide relief for borrowers, the reaction of financial markets was violent. The Polish złoty significantly lost value against major currencies, and the US dollar recorded a strong increase. Simultaneously, the Warsaw Stock Exchange, represented by the WIG20 index, came under downward pressure, fitting into a broader trend of retreat from risky assets in Europe. The situation is complex because the National Bank of Poland has been struggling with a lack of profit since 2021, limiting the possibilities of replenishing the state budget from this source. The Monetary Policy Council was established under the 1997 constitution as the NBP body responsible for setting the assumptions of monetary policy and implementing them through interest rate regulation.In the real estate market, we are observing a phenomenon described by analysts as groundbreaking. Although the new supply of developer apartments shows a downward trend, the total market supply remains stable, exceeding the level of 60,000 available units. Despite a smaller number of new investments, the ratio of sales to new offers has not reached a disproportion suggesting a threefold advantage of demand. The consequence is an inevitable rise in prices, with the threshold of PLN 20,000 per square meter in the largest cities becoming the new reality. Despite the digitalization of financial services, Poles remain attached to cash, which corresponds with trends observed in Sweden, where authorities recommend citizens keep physical means of payment in case of digital system paralysis. 58% — drop in developer apartment supply However, the Polish economy shows great resilience in trade. The January boom in retail sales placed our country as the leader in growth among the large economies of the European Union, while in the eurozone the growth rate was significantly lower and amounted to 2 percent year-on-year. Although Poland outpaced its western neighbors, the eurozone avoided the year-on-year declines forecast by some analysts. This divergence between Poland and the West highlights the specific moment in the economic cycle we are in. At the same time, the closure of the prestigious Gucci boutique in Warsaw's Vitkac fashion house is interpreted as a symbolic end of an era in luxury retail, which may suggest a reshuffling in the preferences of the wealthiest consumers. „To dobra wiadomość dla tych, którzy chcą inwestować, ale musimy pamiętać o ryzykach związanych z inflacją.” (This is good news for those who want to invest, but we must remember the risks associated with inflation.) — Marta Moksa

Mentioned People

  • Adam Glapiński — President of the National Bank of Poland, whose speech the markets are awaiting in the face of the złoty's weakness.
  • Marta Moksa — Expert commenting on the impact of interest rate cuts on the investment market.