GDP growth continues at a steady pace in Q3

In August, retail sales increased by 11.5%, y-o-y. "Data on sales is consistent with rapid economic growth. These are a good indication of internal demand and GDP growth, which should stand at 5% in Q3," said Piotr Kalisz, an economist with Bank Handlowy. According to the Central Statistical Office (GUS), GDP growth in Q3 will not outpace growth in H1, but it will continue to grow at a similar pace. Rapid growth in the economy is due to the improving market situation. "Employment is growing and unemployment is dropping, while households have more disposable income, which is fueling consumption demand," said Piotr Bujak, an economist with BZ WBK. In August, unemployment dropped from 15.7% to 15.5%, which means that around 2.4 million people do not have jobs. According to Piotr Kalisz, interest rates will be raised in 2007. (Puls Biznesu, pp.1, 8) M.M.