Bloomberg News

Polish Economy Slowed Last Quarter on Export Demand, Poll Shows

November 30, 2011

Nov. 30 (Bloomberg) -- Poland’s economy probably slowed in the third quarter as domestic demand failed to maintain growth amid a European debt crisis that weighed on exports.

Gross domestic product expanded 4 percent from a year earlier compared with 4.3 percent in the previous three months, according to the median estimate of 30 economists surveyed by Bloomberg News. The Central Statistics Office in Warsaw will publish the data at 10 a.m. today.

Buoyed by consumer spending, Poland was the only European Union nation to avoid recession in 2009 after Lehman Brothers Inc.’s collapse triggered a global economic crisis. Retail sales jumped 11.4 percent in September, the fastest in four months, even as grow slowed in the 17-member euro region that buys 55 percent of Polish exports.

“We expect the data to confirm that Poland’s economy did rather well,” Maja Goettig, chief economist at Bank BPH in Warsaw, said before the release. “But investor attention is skewed toward the country’s uncertain prospects.”

The global economy is under threat from Europe’s fiscal crisis, the Paris-based Organization for Economic Cooperation and Development said this week. The euro region is already in a “mild recession,” with GDP set to expand 0.2 percent in 2012 and 1.4 percent in 2013, the OECD said.

Zloty, Swaps

The zloty, the sixth-worst performer against the euro since July among currencies tracked by Bloomberg, traded at 4.531 per euro late yesterday in Warsaw after touching a two-month low on Nov. 24. Credit-default swaps insuring against non-payment fell 27 basis points to 312 after increasing to 340 on Nov. 25, the highest since the credit crisis peaked, according to data compiled by CMA.

Poland’s third-quarter growth was probably driven by domestic demand, the survey showed. Krakow-based Alma Markets SA and Gdynia-based Bomi SA, two supermarket chains, boosted sales by 7 percent and 2.3 percent, respectively, from a year ago during the period.

Private consumption “maintained moderately fast growth,” Maciej Reluga, chief economist at Bank Zachodni WBK, said by phone before the release.

Investments in roads and bridges also grew, based on nine- month Office data from the statistics office show. Poland, a country of 38 million, is the highest net recipient of EU in the bloc’s 2007-2013 budget, getting 67 billion euros ($89.3 billion) in aid to iron out differences between richer and poorer states. It’s also preparing to co-host the 2012 European soccer championships.

Poland’s purchasing managers’ index, a gauge of manufacturing, fell to 50.2 in September, missing economist forecasts as the euro area’s debt crisis acted as a “significant drag” on industry, HSBC said Oct. 3. While it rebounded to 51.7 in October, export orders fell for a fifth month. A reading above 50 indicates growth.

2012 Growth

There is “no doubt” Poland’s economy will expand by 4 percent or more this year, Finance Minister Jacek Rostowski said Nov. 10. It will grow by 2.5 percent in 2012, the government has forecast in it budget for next year.

The central bank trimmed its 2012 growth forecast to 3.1 percent from 3.2 percent Nov. 9. It kept the seven-day benchmark rate unchanged at 4.5 percent for a fifth month, saying the economic slowdown in Poland will be “milder” than in neighboring countries.

Sales at Unilever Polska slowed this year for the first time, “but this is not a drama as Poland is for us one of the best markets in the region,” Sanjay Dube, the company’s president, told Bloomberg Business Week this week.

Market consensus is moving toward 2012 growth of less than 2 percent, according to Citibank Handlowy’s chief economist Piotr Kalisz, who sees 1.9 percent expansion.

“Unfortunately, the scenario of deep recession in the euro region means there’s a risk our forecast may shift even lower,” he wrote in an e-mailed note yesterday.

--With assistance from Barbara Sladkowska in Warsaw. Editors: Andrew Langley, Alan Crawford.

To contact the reporter on this story: Dorota Bartyzel in Warsaw at

To contact the editor responsible for this story: Balazs Penz at

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