S&P cuts Poland's rating outlook. Piotr Soroczyński: this may not be the end

On November 6, S&P downgraded Poland's rating outlook to negative, citing worsening fiscal conditions and rising debt. This marks the first downgrade in ten years, following similar negative outlooks from Fitch and Moody's. Analysts warn that without significant fiscal consolidation, Poland may face a recession and potential further rating cuts. The current public finance deficit is around 7% of GDP, driven by high defense and social spending. Political tensions complicate fiscal reforms, with the government struggling to implement necessary measures. S&P forecasts that Poland's debt could exceed 70% of GDP by 2029, emphasizing the need for a credible plan to stabilize finances and regain investor confidence.