Polish wages rose 9.8 percent y/y

Polish corporate sector wages rose 9.8 percent year-on-year in October, in line with market expectations confirming that the labor market in Poland is stable, however, analysts expect employment to be reduced.

According to a report released by the statistical office (GUS), the data showed that wages rose to zł.3241.81 per month. In terms of month-to-month, wages rose 2.2 percent.

Meanwhile, analysts at Citi Handlowy believe that the average nominal wages will increase by 6.7 percent y/y next year, thus implying real wage growth at 3.4 percent y/y, the report wrote.

The GUS data also showed that corporate employment rose 3.6 percent year-on-year in October. However, analysts believe that employment will be reduced. "It can be expected that employment will be reduced, especially in the manufacturing sector. This is going to lead to  a slowdown in wage growth. Taking that into account, we believe the MPC will cut rates at the beginning of 2009," Piotr Bujak, economist at BZ WBK bank told Reuters.

Sources: Reuters, GUS