Poland’s consumer prices likely to have increased marginally in May

Poland’s CPI inflation is likely to have risen slightly in May on year-on-year terms. The projections are at par with the CSO flash estimates. The CPI is expected to have risen slightly from -1.1 percent y/y in April to -1 percent y/y in May, said Societe Generale in a research report. However, CPI is likely to have accelerated by 0.1 percent in sequential terms.

The monthly rise in CPI shows the increases in food and transport prices, which are likely to have gained 0.1 percent m/m and 2.7 percent m/m respectively. Transport prices are likely to have increased because of rise of 4.2 percent m/m in fuel prices in May. Within other components, recreation and culture is likely to have registered a drop of about 1 percent m/m. Core inflation in Poland is expected to have remained unchanged at -0.4 percent in May, according to Societe Generale.

Meanwhile, Poland is due to release its current account data for April on Tuesday that is expected to have registered a surplus of about EUR 60 million, as compared with a deficit of EUR 103 million in March, noted Societe Generale. Poland is expected to have recorded a trade deficit of EUR 22 million in April, as compared with a deficit of EUR 204 million in March.

Both imports and exports are expected to have declined because of monthly drop in manufacturing in April. However, the trade figures are expected to be higher than in 2015. Poland had recorded an export order growth of 32.3 percent y/y.

Moreover, the nation received EUR 501 million in the EU fund transfers in April that should lead to a primary income deficit of about EUR 714 million. Meanwhile, services account is expected to have registered a surplus of about EUR 912 million, whereas the secondary income account is likely to have recorded a deficit of EUR 116 million, added Societe Generale.