Rating agency S&P shifts Poland’s credit outlook to negative and lowers currency rating
Poland has seen "one of the most significant fiscal deteriorations globally", write S&P.
Credit rating agency S&P has lowered Poland's credit outlook to negative and downgraded its local currency rating, citing the country's significant fiscal deterioration and political polarization. S&P's decision follows similar moves by its peers Fitch and Moody's. The agency points to Poland's ballooning budget deficits, driven by a rapidly expanding defense budget and higher social spending, as well as the risk of policy flexibility being constrained in the face of future shocks.
Poland's net debt is projected to exceed 70% of GDP by 2029, a rise of more than 20 percentage points over five years. The agency also highlights the constraints imposed by opposition-aligned President Karol Nawrocki, whose veto power makes meaningful fiscal consolidation unlikely before the 2027 parliamentary elections.
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