The highest level of inflation in Poland in 21 years

The recently announced final level of December annual inflation (8.6%) is clearly higher than in last 3 months: in November it was 7.8%, in October 6.8% and in September 5.9%.

Euro biljetten
Beeld: ©AgaMurawska

As in previous months, the highest price dynamics was achieved in the transport category (+ 22.7%), which of course results from galloping fuel prices (over 30% higher than in December 2020). The prices of food and non-alcoholic beverages (by 8.6%) as well as the use of a flat and energy carriers (by 11.2%) also increased significantly.

The huge increases in energy and gas prices that took place at the beginning of the year are particularly problematic. Gas prices increased by as much as 300-700%, and electricity prices by an average of 30%.

Very fast price increases were recorded by many food products: poultry (30.1% y / y), vegetable fats (24.5%), sugar (23.3%), butter (19.3%), beef (20%) , bread (30.3%) and vegetables (11.6%), eggs (11.5%) and flour (11.3%).

The government is trying to correct this situation introducing reductions in VAT rates for fuel (to 8%),  reduction of VAT on food to 0% (but only on products with a current VAT rate 5%), continue of the reduction of VAT on electricity from 23% to 5% and reduction VAT on fertilizers to 0% from 8%.