In light of the recent GDP data (0.2% growth in 2023), the Polish economy turned out to be less dynamic than previously forecasted.
Private consumption growth remains weak. Despite a solid increase in consumer incomes, consumption is expected to grow by less than 4%, mainly due to high interest-related debt burdens and the need to rebuild real savings following the inflationary episode of the past two years.
The Polish złoty has benefited from favorable global conditions. Wall Street is hitting new records, reflecting a strong appetite from institutional investors for riskier assets. At the same time, the US dollar has weakened significantly against the euro.
In Poland, there is a strong emphasis on bringing inflation back to the official target. The target is only 0.3% away, and given the current trend, reaching it seems very likely.
The European Central Bank left interest rates unchanged at its latest meeting, maintaining the rate at 4.5%. Will a rate cut be possible before the summer break? Probably yes—such an opinion was recently expressed by Joachim Nagel, President of the Bundesbank, whose insights are certainly worth noting.
Exchange rates as of March 11, 2024, 08:00 AM:
• EUR: 4.3018
• USD: 3.9306
• CHF: 4.4817
• GBP: 5.0534
