19:29 3 February 2024
Polish GDP growth to reach 3.7% in 2024, interest rate cuts expected from 2025
Poland's GDP is expected to grow by 3.7 percent in 2024, followed by growth of around 3 percent in the next two years, according to EY economists. In October, they predicted a GDP growth of 3.3 percent this year.
According to EY, inflation will reach the NBP's target of 2.5 percent in the spring of 2024, but will then rise again and remain at an elevated level of 3.5-5 percent until 2027. EY believes that interest rates should remain unchanged this year, with cuts returning in the following year, when the main rate will reach 5 percent (compared to 5.75 percent currently).
"Consumption has started to grow slowly in the face of falling inflation and strong growth in nominal wages, although the end of the year was disappointing in this respect. At the same time, investment growth remains high, which is a result of the absorption of EU funds. I expect the economy to accelerate significantly in the coming quarters, which will be caused by a further decline in inflation, an increase in the purchasing power of Poles due to the indexation of social transfers for families up to 800+, and rising wages, which in turn are driven by the increase in the minimum wage and a significant increase in wages in the public sector," Marek Rozkrut, EY partner, head of the Economic Analysis Team, EY chief economist for Europe and Central Asia, said.
(ISBnews)
