MACROscope

This is yet another year on a forecasting rollercoaster: In just a few months we have moved from worries about the 3rd wave of Covid-19 and downward forecast revisions to re-opening economies, growing optimism and a rise of GDP forecasts, now back to increasing fears of the 4th wave; from an unusually cold April-May to a super-hot June; from NBP rate cut signals at the start of the year to rising rate hike expectations. The only area where the direction of forecasts has not changed, at least until recently, is inflation: CPI growth almost doubled since December’s 2.4% y/y until May, with analysts’ expectations for both 2021 and 2022 steadily moving up. (...)

Only several weeks after the third wave of Covid-19 pandemic triggered a downward revisions of economic forecasts for Poland, we are witnessing the opposite trend: the most recent economic indicators are increasingly positive, signalling that the economic scenario may be actually much better than earlier predicted. The demand started reviving already at the very start of the year, in the period when pandemic restrictions were still in place, and it is rational to assume, we think, that once those restrictions are gone and uncertainty about future diminishes, the spending spree will gain momentum and economic growth will accelerate further. Especially that balance sheets of both households and companies are surprisingly healthy overall and did not suffer, but in fact improved during the pandemic.  (...)