TOP MACRO THEME(S):
- Third consecutive positive CPI surprise: CPI inflation in January rose to 17.2% y/y from 16.6% y/y in December. This is the third in a row CPI result that turned out to be better than expected.
WHAT ELSE CAUGHT OUR EYE:
- CAB balance in December was negative (EUR 2.5bn), after a surplus in November (EUR 0.3bn). However, the 12m rolling deficit narrowed to 3.1% from 3.4% GDP. We expect the CAB balance to improve further in the course of 2023 due to improving terms-of-trade and strong exports performance.
- GDP growth in 4q22 slowed down to 2.0% y/y from 3.6% y/y in 3q22. The biggest surprise was the q/q sa reading: -2.4%, lower than expected. The sa data implies that since 1q22 GDP has declined by 3.7%. There are, however, unusually large discrepancies between the sa and nsa data, as well as between deflators (last year prices vs 2015 base prices).
- According to the new European Commission’s forecasts, Poland’s GDP growth in 2023 will slow down to 0.4% (previous forecast: 0.7%). In 2024 the compounded GDP growth since 4q19 (pre-Covid level) should reach 11.5% (the sixth strongest result in the EU). HICP inflation forecast for 2023 was reduced (to 11.7% from 13.8%), but still is the second highest in the EU.
- President A.Duda announced he would send the Supreme Court bill (one of the RRF key milestones) to the Constitutional Court for adjudication. This will delay the awaited PL-EU agreement on the RRF by at least several months.
- According to the CJEU's Advocate General opinion on CHF mortgage loans, Polish banks will not be able to claim remuneration for the capital in contracts which are deemed invalid. The opinion is not binding. The final ruling is expected in June/July at the earliest.
THE WEEK AHEAD:
- The bunch of monthly indicators from Poland’s economy should (again) show slowdown and disinflation (details in calendar). However, we see a chance for better results than in December due to warm weather and positive working day effect (y/y).
NUMBER OF THE WEEK:
- -5.0 – (Jan’23) the biggest drop (% y/y) of power consumption (excluding pandemic period) since 2013 due to warm weather.