Poland's Future Inflation Index up in September - BIEC

Poland's Future Inflation Index (WPI), an indicator that predicts consumer price trends over the coming months, rose by 0.5 point month on month to 70.8 points in September 2020, the Bureau for Investments and Economic Cycles (BIEC) wrote in a report on Tuesday.

It was the second consecutive increase of the gauge, however, according to BIEC, the WPI does not seem to indicate the emergence of inflationary pressure in the economy, as it is not supported by supply and demand factors.

The global commodity markets also show no clear tendency to increase prices, and the domestic demand pressure resulting from changes in real wages and employment levels has significantly reduced in recent months, the authors of the report said.

"(...) This phenomenon, along with the expiration of the protective measures introduced during the lockdown, may still deepen by the end of the year. As a consequence, consumer demand will decrease, which will work towards reducing the rate of price growth," they added.

According to the report, the number of consumers fearing higher inflation has gone done down to 72 percent from 82 percent in the early days of the pandemic in April. Also, the predominance of companies that plan to increase prices in the near future remains at 2 percent, the lowest level since 2016.