Labor market improves, albeit below expectations

Salaries in Polish enterprises stood at PLN 3,893.23 in August, a 3.5 percent increase year-on-year, below market expectations of a 3.8 percent increase. In month-on-month terms they fell by 1.8 percent. Altogether enterprises employed 5.534 million people, 0.7 percent more than in August last year. Market consensus saw an increase of 0.8 percent. Economists say that the improving labor market may somewhat cushion the impact of negative CPI inflation, which currently stands at -0.3 percent. Interest rates cuts are still expected in the coming months, though. “The situation on the labor market is supportive for households’ income and private consumption, but not enough in order to prevent from trimming official rates,” analysts from BZ WBK wrote.