On September 5, 2025, Fitch announced a decision to change the rating outlook to negative, while maintaining Poland’s rating at A-/F1 for long- and short-term liabilities in foreign currency, respectively, and A-/F1 for long- and short-term liabilities in local currency, respectively.
The agency’s decision is driven in particular by the increased deficit in 2024 and 2025 (likely at 6.7% of GDP), the heightened political challenges in implementing fiscal measures, and, in the agency’s assessment, the lack of a credible fiscal anchor, which are likely to complicate Poland’s ability to conduct significant fiscal consolidation before the next parliamentary elections in 2027.
The agency predicts that the higher fiscal deficit will lead to a faster increase in general government debt, heading towards 68% of GDP by 2027.
Fitch forecasts the deficit to rise to 6.9% in 2025 (more than twice the “A” median of 2.9%), and then decline slightly to 6.8% of GDP in 2026, above the government’s budget forecast of 6.5%, and then to 6.3% in 2027.
The agency Fitch forecasts that general government debt will rise to 59.3% of GDP in 2025, from 55.3% in 2024 and 49.5% in 2023.
Fitch forecasts that the public debt-to-GDP ratio will continue to rise in the coming years unless additional consolidation measures are taken.
According to Fitch, the start of President Karol Nawrocki’s term highlights the likely challenges the coalition will face in implementing its policies. Fitch notes that since his inauguration in early August, the president has vetoed several bills, publicly expressed opposition to tax increases, and proposed tax cuts. Amidst heightened political polarization, as demonstrated by the May presidential election, the influence of domestic political conditions on policy decisions is likely to intensify ahead of the next parliamentary elections in October 2027. This could limit the room for manoeuvre in implementing politically controversial measures before 2028, including those supporting fiscal consolidation.
At the same time, according to the agency, Poland’s rating is supported by a large, diversified, and resilient economy, a history of sound macroeconomic policy based on EU membership, solid external finances, and a higher and more stable budget revenue base than in similarly rated countries. These are offset by a high deficit, rising public debt, and lower revenue and governance indicators compared to similarly rated countries.
Fitch forecasts growth of 3.2% in both 2025 and 2026, above the median of 2.3%, as the impact of US tariffs on the eurozone’s growth prospects will be largely mitigated by domestic consumption and increased absorption of EU funds (around 1% of GDP in 2025 and 3% in 2026). Nevertheless, implementing the reforms necessary to maintain EU financing will remain crucial to maintaining strong GDP growth.
Fitch forecasts a current account deficit of around 1% in 2025-2027, fully covered by net foreign direct investment inflows averaging 2% of GDP. Poland’s external buffers continue to strengthen, with projected foreign exchange reserves reaching $249 billion (€214 billion) by the end of 2025, covering 5.3% of projected current external payments. As a result of public and private sector debt reduction, Poland’s net external debt has fallen from 37.1% of GDP in 2013 to a net creditor position of -1.7% in 2024 (median “A” -6.0%). Fitch expects Poland to continue strengthening its net creditor position in the medium term.
Rating Outlook
Factors that could lead to an upgrade include increased confidence in Poland’s ability to implement fiscal consolidation measures sufficient to stabilize the general government debt-to-GDP ratio in the medium term.
A downgrade is possible if the government fails to stabilize the public debt-to-GDP ratio in the medium term, for example, due to the inability to implement fiscal consolidation measures, lower growth, or a significant increase in government financing costs.
Furthermore, significantly lower medium-term growth prospects, for example, due to erosion of competitiveness or a weaker external environment, could be a factor.
