2 Jul 2013
Flash: Economic adjustment is reaching the bottom for Poland – TD Securities
FXstreet.com (London) - Cristian Maggio, strategist at TD Securities comments on what he sees as turning point.
He said a late start of the easing cycle in 2012 means that Poland will miss its chance for an early demand-driven recovery. In fact, he said, although Q2 may be a turning point for GDP growth, data during the quarter has been weaker in comparison with the regional peers.
This and the disappointing 0.5% Y/Y print in Q1 reinforced his teams conviction that GDP growth will be 0.5ppt lower than prior forecasts at 1.0% in 2013 and 2.5% in 2014. However, they expect that the effects of monetary easing will contribute to faster lending, feeding into stronger private consumption and investment growth in H2. He said together with the improving industrial production in Germany, this should limit the scope for further downside revisions.
He said a late start of the easing cycle in 2012 means that Poland will miss its chance for an early demand-driven recovery. In fact, he said, although Q2 may be a turning point for GDP growth, data during the quarter has been weaker in comparison with the regional peers.
This and the disappointing 0.5% Y/Y print in Q1 reinforced his teams conviction that GDP growth will be 0.5ppt lower than prior forecasts at 1.0% in 2013 and 2.5% in 2014. However, they expect that the effects of monetary easing will contribute to faster lending, feeding into stronger private consumption and investment growth in H2. He said together with the improving industrial production in Germany, this should limit the scope for further downside revisions.