INFLATION IN POLAND: MACROECONOMIC ANALYSIS

Abstract

The research relevance is predefined by the need to explain the nature of inflation and assess the effectiveness of anti-inflationary policy in Poland. The research aims to study the factors that cause price growth and the tools to reduce its pace during the global economic crisis. The following research methods were used: analysis of statistical data on inflation dynamics; comparison – for comparing price growth indices; expert estimates – for forecasting inflation; graphical – for displaying results; and generalisation – for summarising information on the use of inflation reduction tools. The main results obtained in this study are: determination of the dynamics of producer price indices, consumer prices and the gross domestic product (GDP) deflator in Poland; comparison of Poland’s inflation rate with other European countries and justification of the reasons for its rapid growth; analysis of the use of inflation targeting in Poland, Romania, the Czech Republic and Hungary; and assessment of the effectiveness of the central bank’s increase in the key interest rate and required reserve ratios, as well as the impact of these instruments on the inflation rate in Poland; proving the non-monetary nature of inflation and identifying its main drivers in the period 2020-2023 (coronavirus pandemic, rising global energy and food prices, war in Ukraine); identifying the effects of lowering value-added tax (VAT) rates on certain goods on inflation and tax revenues to the Polish budget; comparing the forecast inflation rate and GDP growth by the end of 2023 and 2024-2025 based on expert estimates; substantiating the ways to slow down inflation, considering a wide range of external factors affecting the Polish economy. The results and conclusions are of practical importance for the Government of the country and managers of the banking sector in developing measures to regulate the rate of price growth.