Poland’s current account deficit sharply deteriorated in April as fuel imports surged
Poland's current account deficit has seen a significant deterioration in April due to surging fuel imports and unfavorable terms of trade from rising energy prices. Per the full note from ING, the April deficit amounted to €1,558 million, substantially higher than market expectations of €505 million and reflecting a worsening from March's deficit of €234 million. This trend indicates potential weakening in the zloty's external liquidity context as the current account deficit now stands at approximately 0.9% of GDP, creeping up from 0.8% in March. As traders assess the potential implications for the Polish zloty, historically elevated energy prices could hinder the economic outlook and currency stability going forward.
What the desk is arguing
The desk posits that the rapid deterioration in Poland's current account balance highlights vulnerabilities in the economy stemming from external shocks, particularly high energy costs. Per the full note from ING, the sharp rise in fuel imports has played a central role in this set-back.
In April, the merchandise trade balance reflected a deficit of €1,995 million, drastically widening from March's €497 million. This worsening was combined with a growth in imports that outpaced exports, which saw a modest year-on-year increase of 6.6% against a 7.8% rise in imports encompassing key commodities such as energy, indicating a potentially challenging economic landscape ahead.
Where it sits in our coverage
Our consensus target for USD/PLN sits at 1.075 with a range of 1.04 to 1.12 for March 2026. Specific forecasts include: - jpmorgan: 1.10 - bofa: 1.04
The desk's perspective aligns with jpmorgan's target, which views the current economic challenges as risks that could enforce a depreciation of the zloty against the dollar. Conversely, bofa presents a more cautious outlook, reflective of a less aggressive stance in the zloty forecast.
How other firms see it
The consensus seems to form around firms like jpmorgan and others that signal potential depreciation due to the economic pressures identified, while bofa stands in contradiction with a more conservative view.
Traders should keep an eye on related currency pairs such as EUR/PLN, as movements may reflect speculation surrounding the Polish economy's response to energy price fluctuations and external demands. Also, given the current economic challenges, the monetary policy insights from regional central banks could heavily influence future zloty valuations.
How firms align with this view
Aligned with the desk view
Contrary positioning
Key takeaways
- 01Poland's current account deficit reached €1,558 million in April, significantly worse than expected.
- 02Fuel imports surged, exacerbating the deficit and worsening the terms of trade.
- 03The current account deficit is now approximately 0.9% of GDP.
- 04The zloty's external position may remain under pressure given ongoing energy price concerns.
Market implications
Watch for USD/PLN to test levels around 1.075, as the current economic situation could lead to increased volatility in the zloty ahead of any central bank comments on policy direction.
Risks to this view
Should energy prices stabilize or decline sharply, there could be a significant reversal in the zloty's performance as the current account balance improves, invalidating the bearish outlook.
Older quick take Quick take 15:58 Poland Poland’s current account deficit sharply deteriorated in April as fuel imports surged Poland’s current account balance deteriorated sharply in April, reflecting worse terms of trade due to higher energy prices. However, Poland’s external position remains robust, and we expect the current account deficit to reach 1.6% of GDP in 2026 Poland's current account deficit was significantly worse than expected Share X LinkedIn E-mail Copy link Share X LinkedIn E-mail Copy link Download Leszek Kasek Senior Economist, Poland According to data from the National Bank of Poland, the current account deficit amounted to €1,558 million in April, three times worse than the consensus forecast (-€505 million; our forecast: -€342 million). This represented a marked deterioration compared with the March reading (-€234 million).
We estimate that the 12-month current account deficit as a share of GDP worsened to 0.9% of GDP from 0.8% of GDP in March. The April current account deficit in the balance of payments comprised: A merchandise trade balance of -€1,995 million from -€497 million in March. The sharply wider goods deficit occurred alongside high trade turnover: the value of exports in euro terms rose by 6.6% year-on-year in April, while imports increased by 7.8% YoY.
Export growth slowed from 7.4% YoY in March, whereas import growth accelerated sharply from 3.8% YoY in March. The traditionally positive balance in services trade of €3,466 million from €3,067 million in March; Negative balances on the primary income account (-€2,951 million, after -€2,783 million a month earlier) and on secondary income (-€78 million, after -€21 million in March). The NBP analyst commentary, referring to changes in the value of trade aggregates in PLN (the zloty appreciated by 0.3% YoY against the euro in April), points to a strong increase in exports of intermediate goods, including copper and raw silver.
A solid increase was also recorded in exports of computers, which is rather a re-export category. Export dynamics, however, were being held back by declines in the automotive sector and in durable consumer goods, and this is a long-standing and concerning trend. The strong increase in imports, by contrast, resulted from higher fuel prices, as well as increased import spending in categories such as computers, immunological products and vaccines.
Imports of cars continued to rise, accompanied by a decline in deliveries of automotive parts. We had expected that the value of crude oil and natural gas imports to rise significantly this year following the jump in energy prices since the start of the war in the Middle East, and this is reflected in the monthly data. The increase is incorporated into our forecasts for the current account balance this year (-1.6% of GDP in 2026, after -0.9% of GDP in 2025).
Given weak demand from Poland’s main trading partners, net exports will not be a driver of Polish GDP growth this year. We currently forecast euro area GDP growth at just 0.3% in 2026, and 0.6% in Germany. Nevertheless, despite the deterioration expected this year due to the oil shock, Poland’s level of external imbalance remains low and does not materially affect the PLN exchange rate.
The zloty is influenced primarily by developments in core markets as well as by MPC decisions and communication. Merchandise exports and imports growth, YoY, in % Source: NBP data. "> Source: NBP data. Content Disclaimer This publication has been prepared by ING solely for information purposes irrespective of a particular user's means, financial situation or investment objectives.
The information does not constitute investment recommendation, and nor is it investment, legal or tax advice or an offer or solicitation to purchase or sell any financial instrument. Read more Older quick take
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