Poland Macro Weekly: Sudden shift of the MPC

TOP MACRO THEME(S):

Discussion on NBP rate cuts postponed to October? – December brought an unexpected shift in the forward guidance of the MPC, more specifically of the NBP’s governor. Yet, recent data and comments from other MPC members do not rule out a discussion on resumption of rate cuts starting from March.

WHAT ELSE CAUGHT OUR EYE:

Poland’s PMI manufacturing for November declined the first time in 5 months, to 48.9pts from 49.2pts in October. The decline was mainly caused by a faster decline in new orders and a weakening of production, but the overall picture is mixed. On the one hand, the decline in new orders and production still points to significant challenges, such as weakening demand in Europe and ongoing geopolitical uncertainty. On the other hand, the stabilization of the PMI in recent months and the observed increase in employment could indicate a gradual shift of the Polish manufacturing into a recovery phase.
According to a tentative estimate, the registered unemployment rate in November inched up to 5.0% from 4.9% in October, in line with the expectations. Monthly increase in the number of unemployment was stronger than implied from the seasonal pattern, with the strongest inflow coming from manufacturing, trade and construction sectors. It is worth to note that tentative estimated of the Labour Ministry for October turned out to be higher than the official number published later by the statistical office.
Median wage in the national economy at the end of June was 6507.39 PLN and was lower than the average wage by 19.2%. Median wage in case of men stood at 6755.68 PLN, while for women was lower by 455.68 PLN.

THE WEEK AHEAD:

Noteworthy data releases will take place on Friday: full reading of CPI inflation in November (4.6% y/y according to flash vs. 5.0% y/y in October) and balance of payments data for October. Following surprising rhetoric pivot of NBP governor, there will be much focus on possible comments from other MPC members.

NUMBER OF THE WEEK:

983.88 thous. – number of Ukrainians having a temporary protection status in Poland in October, the second highest after Germany.