Headlines
Poland seeks to freeze fourth quarter energy prices, boosting rate-cut hopes
Published by Global Banking & Finance Review®
Posted on September 5, 2025
2 min readLast updated: January 22, 2026
Global Banking & Finance Review®
Company
Published by Global Banking & Finance Review®
Posted on September 5, 2025
2 min readLast updated: January 22, 2026
Poland extends its electricity price freeze through Q4, reducing inflation risks and increasing market expectations for interest rate cuts.
WARSAW (Reuters) -The Polish government will extend the cap on electricity prices through the fourth quarter, Energy Minister Milosz Motyka said on Friday, which could remove one inflation risk and boosted market bets on an interest rate cut.
Power prices would be frozen at 500 zloty ($137) per megawatt hour in the final three months of the year, Motyka said.
Poland's electricity price cap for households expires in October and the central bank has pointed to this as an inflation risk factor and a source of uncertainty.
Last month, President Karol Nawrocki vetoed a bill meant to ease rules for building onshore wind farms, which included regulations extending a price freeze. He submitted a draft bill to parliament that included just the government's energy freeze proposal.
The government has now prepared a new bill freezing prices in the fourth quarter and included a wage-dependent subsidy to household heating bills starting this year. Motyka said it would pass parliament this month, adding he did not think further energy price freezing would be necessary.
"In our opinion, there will be no need to freeze prices because we expect energy prices to fall below 500 zlotys per MWh," he told journalists.
Market expectations for interest rate cuts within three months increased slightly following Motyka's statement.
"The market is becoming convinced that this reduction can take place," Santander Bank Polska economist Piotr Bielski said.
He did not rule out a rate cut in October, but expected rate setters to opt to wait for the central bank's next inflation projection, due in November.
Warsaw's utility index outperformed the market, gaining 3.5%.
Erste Securities utilities analyst Petr Bartek attributed this to Motyka's comments on electricity prices in 2026 as wholesale market prices fall.
"This would be a clear positive move for the sector," he said.
($1 = 3.6405 zlotys)
(Reporting by Marek Strzelecki, Anna Wlodarczak-Semczuk, Karol Badohal in Warsaw and Julia Kotowska in Gdansk; Editing by Emelia Sithole-Matarise and Alex Richardson)
The Polish government will freeze electricity prices at 500 zloty ($137) per megawatt hour for the fourth quarter.
The central bank has pointed to the expiration of the electricity price cap for households in October as an inflation risk factor.
Milosz Motyka expressed that he expects energy prices to fall below 500 zlotys per MWh, suggesting that a price freeze may not be necessary.
Market expectations for interest rate cuts increased slightly following Motyka's statement, with some economists believing a rate cut could happen as soon as October.
The government has prepared a new bill to freeze prices in the fourth quarter and included a wage-dependent subsidy for household heating bills starting this year.
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