CPI to reach 3.3% and GDP fall by 3.6% in '20: NBP survey

Analytical centers surveyed by the National Bank of Poland (NBP) expect that the average annual CPI inflation in 2020 will amount to 3.3 percent, while in 2021 the indicator will drop to 2.3 percent. Economists expect a 3.6 percent decline in Poland's GDP in 2020, and a rebound of 3.7 percent in 2021.

"The aggregate distribution of CPI inflation forecasts suggests that with 85 percent of probability, average annual inflation in 2020 will be above the NBP inflation target. The central scenario is 3.3 percent and the limits of the 50 percent of probability range are 2.8 percent and 3.8 percent. For 2021, the central scenario (equal to 2.3 percent) is not well outlined: values ​​in the range of 1.3-3.2 percent are also likely to coincide with a 50 percent probability range," NBP said.

The surveyed experts are sure that there will be a recession in Poland in 2020 (probability equal to 92 percent). According to typical scenarios, i.e. contained in the 50% probability range, the depth of recession can be estimated at  minus 1.8-5.0 percent.

The NBP pointed out in a commentary to the survey that high uncertainty about the future macroeconomic processes remains.

"Individual central forecasts remain very varied between experts, and the perception of uncertainty they see is very high. This is particularly evident in forecasts of the GDP growth rate for 2021. As a result, in numerous cases, central scenarios resulting from aggregate distributions are quite poorly outlined. Therefore, more weight should be attached to various scenarios contained in probabilistic forecasts than to central forecasts," the experts stated.

(PAP)