Poland Macro Weekly: Nothing to see here

Nothing to see here: The MPC, deprived of the new inflation data, left interest rates unchanged.
Polish-German industrial tandem still in the game: Our observations from Poland Macro Weekly “Less reliant on Germany?” (May 12th 2022) are still valid. Although trade and industrial ties between Poland and Germany loosened in 2022, Polish-German industrial tandem is still in the game.

Unemployment rate in January went up to 5.5% from 5.2% in December. Total number of registered unemployed increased by 46 thousand in January alone, not much more than in previous years. An increase is seasonal and in line with our labour market scenario - there is a slight cyclical deterioration, but we do not expect a significant increase in unemployment.
According to the survey of senior loan officers in 4q22, banks tightened the criteria for granting all types of loans and recorded a decrease in demand. In the case of consumer loans expectations for 1q23 remain pessimistic (lending policy will be stricter, demand will decline). For mortgage loans we may however be approaching a turning point - both expected demand and credit criteria are expected to turn positive. The demand for mortgage loans could be boosted the recent FSA decision, to cut the minimum buffer for potential rate hikes to 250bp (from 500bp) for fixed-rate mortgages and to place it between 250-500bp for floating rate mortgage loans.

Despite higher monthly reading, the 12m CA deficit to GDP ratio has likely declined in December to 3.2%. Exports keep growing faster than imports.
The range of January CPI forecasts is very wide (16.1-20.5%, PKO: 18.7%). The reading will heavily depend on yet unknown decision of GUS on how to deal with electricity price hikes, which will impact only part of energy consumption.
The GDP slowdown to 2.2% in 4q22 has probably been driven by weaker consumer demand, with relatively immune investment.