MACROscope

After a very deep collapse of economic activity in April, May and June saw signals of rebound from the bottom, as the economic and social restriction were being lifted. Possibly, we are approaching the wave of upward forecasts revisions (especially those more pessimistic). While most of developed countries were able to suppress the numbers of new infections effectively, in many emerging economies the wave is still rising. Worrying sign is the resurgence of infections in regions where restrictions were relaxed after they seemingly coped with pandemic.

We still believe the scenario of economic growth for Poland could be V-shaped: after GDP drop by almost 12% y/y in 2Q20, every next quarter should be better and as a result GDP could drop by c.4% this year and rebound by almost 6% in 2021. 

Economic data started to show first signs of a rebound and financial markets behave as the pandemic was already contained. Truly, so far we have seen only “soft” indicators for May (sentiment gauges), but we are expecting an improvement in “hard” data as well, given that May saw a gradual relaxation of restrictions.

The European Commission’s New Generation plan based on common debt issuance fuelled markets to price-in a swift recovery – and this comes as no surprise, as Poland could gain net resources worth even 7% of annual GDP, alleviating worries about less generous EU means after 2020. It is possible that soon forecasts for EU will be showing the 2021 rebound stronger than the 2020 decline and a faster return to pre-COVID GDP levels