Poland’s CPI revised down to 0.7% y/y for Jan

Polish CPI inflation was revised down to just 0.7% y/y from the preliminarily released 0.9% but then rose to 1.2% in February, in line with expectations, according to final data released Fri. by the Central Statistical Office (GUS) and based on the new inflation basket. The January print was the lowest since November 2016, but the February increase, based mostly on food prices, brought inflation to not too far below 1.5%, the bottom end of the NBP’s +/- 1-pp fluctuation band around its 2.5% target. Still, inflation remains very moderate, particularly considering the pace of economic growth, and that will likely keep the Monetary Policy Council majority very dovish.

In the new basket, the release of which was partial, the biggest change was a large 1.6pps increase in the weighting of transport to 10.34% from 8.74% in 2018. The precise fuel weighting was not released, as far as we can see, but it seems likely to rise from 5.07% in 2018. Another big move was the reduction of the housing, water, power, gas and other weighting to 19.17% from 20.35% the year before, though the precise changes were not given. The communications weighting was cut by 0.69pp to 4.18%, and the health component was lowered 0.57pp to 5.12%. Another major change was the food and non-alcoholic beverage component raised 0.53pp to 24.89%. In the end, it looks like the impact of supply factors like food and transport will be bigger, though the weight of housing is much lower. In 2018, the full basket was released on GUS’s database website (http://swaid.stat.gov.pl) within 10 days.

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