Strong growth on the cards

Industrial output rose by its strongest rate in two years last month. Output rose by an annual 16.4 percent, above the 13.5 percent rate forecast by analysts, meaning the economy is set to grow by five percent in Q1.

Other economic data showed subdued producer-price growth at 0.9 percent year-on-year, suggesting prices at the factory gates are beginning to show the effects of improving growth and domestic demand.

"The picture is pretty consistent across the region," said Robert Beange, an economist with Lehman Brothers in London. "The big factor is the pick-up in eurozone growth."

Poland's economy has recovered steadily from a dip early last year. Last Thursday's data showed the construction sector grew 15.5 percent year-on-year last month, while manufacturing expanded by as much as 18.7 percent. "[This growth] will eventually lead to more pressure on inflation. It is the nail in the coffin for any hopes of interest-rate cuts this month and probably for months ahead," said Lars Christensen, senior analyst with Danske Bank in Copenhagen.

The central bank is widely expected to bring a halt to its easing cycle and maintain the central rate at four percent in April. (Reuters)