Poland is the CEE equivalent of Germany and France (see earlier post below) in that its economy has stubbornly refused to dip into negative territory for very long. The thinking is that its internal market is big enough, and its dependence upon foreign trade so much lower, that the economy hasn’t been impacted as heavily as those in the Czech Republic, Slovakia and Germany.
Now, inflation numbers for July (y-o-y growth of 3.6%) beat expectations, leading analysts to say that further interest rate cuts will now be on hold. For the moment.
‘Poland’s CPI not only beats the consensus but also the regional trend, showing once again that as a more closed economy it has its own dynamic and has not been affected to the same extent as its neighbours by disinflationary import price pressures,’ said Peter Attard Montalto, emerging markets economist at Nomura in London.
Still, there could be pressure for another (possibly final) rate cut by the central bank come September.