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"Poland Business Forecast Report Q2 2014" Is Now Available at Fast Market Research

Fast Market Research recommends "Poland Business Forecast Report Q2 2014" from Business Monitor International, now available

 

Boston, MA -- (ReleaseWire) -- 04/09/2014 -- The export-driven recovery we have anticipated in Poland is now in motion, and we are now turning increasingly positive towards the country's domestic demand outlook. We expect a robust recovery in domestic demand could arrive as early as Q114, as low inflation, solid wage growth and an improving labour market bolster household purchasing power.

Poland's external position remains relatively strong and we estimate the current account deficit arrived at just 1.6% of GDP in 2013. However, a large stock of foreign-owned government paper and ongoing private sector deleveraging represent the two major risks to our sanguine outlook.

We continue to expect the Civic Platform (PO)-led government to serve out its term. The government won a recent parliamentary vote of confidence, suggesting its parliamentary majority is safe for the time being. We also believe that the opposition will struggle to broaden its appeal despite the rising government unpopularity, limiting its ability to challenge the ruling coalition.

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Major Forecast

Core Views

The export-driven recovery we have anticipated in Poland is now in motion, and we are now turning increasingly positive towards the country's domestic demand outlook. We expect a robust recovery in domestic demand could arrive as early as Q114, as low inflation, solid wage growth and an improving labour market bolster household purchasing power.

Poland's external position remains relatively strong and we estimate the current account deficit arrived at just 1.6% of GDP in 2013. However, a large stock of foreign-owned government paper and ongoing private sector deleveraging represent the two major risks to our sanguine outlook.

We continue to expect the Civic Platform (PO)-led government to serve out its term. The government won a recent parliamentary vote of confidence, suggesting its parliamentary majority is safe for the time being. We also believe that the opposition will struggle to broaden its appeal despite the rising government unpopularity, limiting its ability to challenge the ruling coalition.

Major Forecast Changes

Due to weaker than expected demand in H113, we have revised our current account deficit estimate, to 1.6% of GDP in 2013, from 2.0% previously. However, as cyclical rather than structural drivers are behind the smaller deficit, we expect it to widen in 2014 as economic activity accelerates.

In light of accelerating economic activity, we now expect the central bank to hike rates in 2014 by 50 basis points, most likely in the last quarter of the year.

Key Risks To Outlook

Although not our core scenario, we highlight the risk of Greece leaving the euro, potentially leading to a disorderly breakup of the whole common currency bloc. This would likely push Poland into recession.

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