Poland’s labor market data surprised on the upside in April, with solid of job witnessed in transport, manufacturing and trade. Wage growth accelerated 4.6% y/y last month as compared with consensus projection of 3.8% growth. Poland’s wage growth, adjusting for seasonal effects, expanded to almost 4%. This is in line with the country’s falling jobless rate, noted Commerzbank in a research report.
However, the bottom line is the Poland’s wages have been steadily increasing for some time now; nonetheless there has not been any marked pass-through to CPI inflation. There has been constant imported deflation. This is unlikely to change soon; particularly when the Poland’s economic growth momentum has started to slowdown. But the wages data can still bolster the MPC hawks’ hand and provide a delay in beginning the rate cutting cycle that is expected to start in the third quarter, added Commerzbank.
