Fitch Confirms Poland's Rating at A- with Negative Outlook Maintained

Fitch Ratings has decided to maintain Poland's long-term foreign currency rating at "A-". Despite the stable rating, the agency did not decide to improve the outlook, leaving it as negative. Analysts indicate that the main burden for the Polish economy remains the high fiscal deficit, which limits room for maneuver in budgetary policy. Although some data point to an unexpected drop in the deficit in recent months, Fitch remains cautious, assessing long-term risks related to debt servicing costs and defense expenditures. Since the political transformation in 1989, Poland has been building its creditworthiness, reaching investment-grade levels in the mid-1990s, which allowed for cheap access to capital on international markets.The situation on the domestic market is complex. For the first time since 2022, the average interest rate on a mortgage loan has fallen below the 6 percent threshold. This phenomenon improves the creditworthiness of Poles, although banks are increasingly rigorously assessing couples with children, which drastically lowers their chances of obtaining financing. In cities like Warsaw, apartment prices show stabilization, but demand remains high, and units with a popular area of around 50 sqm quickly disappear from the offer market at an average price reaching 580,000 PLN. 5,9 mld zł — is the debt of the Polish construction industryOn the other hand, data from the National Debt Register paint a pessimistic picture for the agricultural and construction sectors. Farmers are struggling with a debt spiral, where in extreme cases repaying obligations takes up to 1200 days. The debt of the construction sector alone has exceeded the level of 5.9 billion PLN, which is an alarm signal for the condition of the entire economy after a frosty winter that slowed down GDP growth dynamics. However, optimism is visible in the banking sector – mBank closed 2025 with a record profit, confirming the high profitability of financial institutions despite a difficult macroeconomic environment. „The maintenance of the Negative Outlook reflects risks to the public debt trajectory from persistent high fiscal deficits.” — Fitch Ratings Expectations for the upcoming Monetary Policy Council meeting in March are divided. Some experts hope for a loosening of monetary policy, which could stimulate consumption, which has suffered due to high energy bills. Although electricity prices on wholesale markets are falling, end consumers in 2026 are still paying high rates, which translates into lower purchasing power of households.