Polish GDP to grow in between 3 - 3.5 pct in 2016, NBP likely to keep rates stable in near future

The Polish economic prospects continue to be good. For the whole of this year, the Polish economic growth is likely to accelerate to 3 percent to 3.5 percent, according to KBC Market Research.

Apart from lower interest rates and a comparatively weak zloty, the Polish economy is expected to attract additional support from policy measures of the new government, stimuli for private consumption. Therefore, the risks stem mainly from a likely worsening in the external environment, particularly in Russia, China and other emerging nations, added KBC Market Research.

Meanwhile, the Polish central bank, National Bank of Poland, is likely to keep official rates stable in the near future as signalled by the official statements and comments of members of the Monetary Policy Council. Even if the NBP’s next move is likely to be on the upside, the short-term risks are skewed to the downside.

“We think that zloty’s sell-off related to markets’ fears coming from appointment of new members of the Monetary Policy Council (MPC) is over now”, said KBC.

However, while domestic fundamentals are expected to be quite supportive for the zloty, the currency is likely to be driven mostly by sentiment in emerging markets and the ECB or the Fed policy actions respectively, added KBC.