Poland inflation rises to 4.0% on fuel costs as US PCE holds at 3.4%

Polish inflation accelerates to 4.0% in September

Statistics Poland published its flash estimate on 30 September 2026, reporting that consumer prices rose 4.0% year on year in September 2026, up from 3.4% in August. On a monthly basis, consumer goods and services increased by 0.7%. The reading places Poland's inflation rate above the National Bank of Poland target tolerance band for the first time in more than a year. Economists from PKO BP stated that the increase was concentrated in fuel and energy costs rather than broad-based price pressures. Underlying core inflation declined to an estimated range of 3.0% to 3.2% year on year, down from 3.3% in August.

Fuel and energy drive domestic price increases

Transportation fuels provided the strongest upward push to the headline index during the month. PKO BP data showed that fuel and lubricant prices increased by 9.2% month on month and were 36.1% higher than in September 2025. Energy carrier prices grew 0.9% from August, lifting their annual rate to 4.9% from 4.1% in the prior month. Food and non-alcoholic beverage prices edged up 0.1% month on month, although they remained 0.5% lower than a year earlier. Economists at Erste Bank Polska noted that the annual food price index rose for the first time since May 2025, reflecting weaker Polish agricultural harvests in 2026.

Interest rate expectations and medium-term risks

Erste Bank Polska projected that Poland's headline inflation is unlikely to fall below 4.0% before March 2027. If crude oil prices trade near $100 per barrel, the bank estimates inflation could reach 4.5% by the end of 2026. Unchanged electricity and natural gas tariffs are currently expected for 2027, but sustained wholesale energy increases could push early 2027 inflation near or above 5.0%. Both PKO BP and Erste Bank Polska expect the Monetary Policy Council to keep interest rates steady at its October session. Erste Bank Polska projects stable benchmark rates through 2026 and 2027, provided regional stability in the Middle East avoids further commodity disruption.

US inflation readings come in below expectations

In the United States, the personal consumption expenditures price index rose 3.4% year on year in August 2026, matching July's rate and falling below the market projection of 3.7%. Month on month, headline PCE increased by 0.3% following a 0.1% increase in July, compared to expectations of 0.4%. The core PCE price index, which excludes food and energy, rose 3.0% year on year, matching July's level and remaining below the expected 3.3%. On a monthly basis, core PCE rose 0.2% after a 0.1% gain in July. Following the data release, the two-year US Treasury yield fell 4 basis points to 4.84%, and the 10-year Treasury yield dropped 5 basis points to 5.2%.

Stronger labor and output data shape Federal Reserve outlook

The US inflation numbers arrived alongside positive readings for economic activity and employment. The private sector added 90,000 jobs in September 2026 according to the ADP national employment report, exceeding the 70,000 forecast and improving from 36,000 additions in August. For the total labor market, economists project 90,000 non-farm payroll positions added in September, down from 162,000 in August. In output data, the final estimate for US second-quarter gross domestic product showed an annualized growth rate of 2.2%, an upward revision of 0.7 percentage points from the previous estimate. First-quarter GDP growth was also revised upward to 2.5%, supported by higher investment, consumer spending, and government outlays.