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Friday, November 30, 2007

Poland GDP Q3 2007

Poland's economy expanded an annual 6.4 percent in the third quarter, a little faster than forecast, increasing concerns that the economy may be running above its long term capacity rate, and raising expectations that the central bank will raise interest rates further. Growth in gross domestic product in the period from July to September compared with 6.7 percent in the second quarter and 6.8 percent in the first quarter, according to the Warsaw-based Central Statistical Office.

The Polish central bank this week raised its benchmark interest rate to a more-than two-year high of 5 percent, the fourth increase this year, on concerns inflation may accelerate further above target. Booming demand for cars, furniture and household appliances has been triggered by an average 10 percent increase in wages this year and a record pace of job creation.

Domestic demand grew 7.4 percent and consumer demand increased 5.2 percent, while investments rose 18.8 in the third quarter, the office said. Production grew 6.6 percent and construction was up 12.6 percent, the office said.

Tuesday, November 27, 2007

Poland Central Bank Meeting

Poland's central bank raised its benchmark interest rate for a fourth time this year today after higher food costs and strongly growing consumer demand is firing up inflation inflation. The bank's Monetary Policy Council lifted the seven-day reference rate by a quarter point to 5 percent.

Poland's $350 billion economy is expected to expand 6.5 percent this year, compared with last year's 6.6 percent, bolstered by domestic consumer demand. Poles are buying more cars, furniture and household appliances after wages soared 10 percent this year and new jobs were created at a record pace.

The zloty traded at 3.651 per euro after the decision, little changed from 3.651 before the decision and up from 3.672 yesterday. Yield on the government's five-year bonds was unchanged after the rate decision. It fell 2 basis points to 6.012 percent from yesterday.

The inflation rate rose in October to 3 percent, above the central bank's 2.5 percent target and in the upper part of the 1.5 percent to 3.5 percent range. Policy makers raised the benchmark rate by three-quarters of a point between April and August in three quarter-point increases.

The average corporate wage rose 11 percent in October, the fastest annual pace in seven years and the unemployment rate fell to an 8 1/2-year low of 11.3 percent. With more money in pockets, Poles moved to buy cars, furniture and household appliances, boosting retail sales in October an annual 19.4 percent, the highest in 3 1/2 years.

The consumer-optimism indicator WOK, compiled by Ipsos market researcher, rose in November by 5 points to 112.9, the highest since 1991.

The Lombard rate, which the central bank charges to commercial banks borrowing overnight with government securities as collateral, was also lifted by a quarter point to 6.5 percent. The discount rate, a reference rate for some bank loans, will rise to 5.25 percent, also by a quarter point.

Monday, November 26, 2007

Poland October 2007 Retail Sales

Polish October retail continued their rapid rate of annual increase adding to evidence that economic growth remains strong despite four interest rate increases from the Central Bank so far this year. Retail sales rose an inflation corrected 16.3% in October over October 2006, this was up from a 12.2% rise in September compared with 14.2 percent in September, according to the Warsaw-based statistics office today.

The growth which is driven by sales of vehicles (which rose 42% year on year) and sales furniture and household appliances (a 21.9% annual rate of increase) - confirms the impression that consumer demand is being bolstered by falling unemployment, which dipped to an 8 1/2-year low, higher wages, which last rose the most in seven years last month, and a steady and economically significant inward flow of remittances.

The unemployment rate fell for the ninth consecutive month in October to 11.3 percent from 11.6 percent in September, the office said in a separate report today. Earlier this month, the office said that average corporate wages advanced an annual 11 percent in October and employment grew a record 5 percent from the year before.

Economic growth slowed to 6.4 percent in the second quarter from 7.2 percent in the first three months of the year. The report on third-quarter gross domestic product will be released on Nov. 30 at 10 a.m. The full-year growth will be in the region of 6.5 percent, Deputy Finance Minister Katarzyna Zajdel-Kurowska said at a seminar in Warsaw today, confirming the ministry's earlier forecast.