Country Forecast Poland Updater
The Economist Intelligence Unit, April 2013, Pages: 19
The Economist Intelligence Unit expects the government, led by the centre-right Civic Platform (PO) with the agrarian Polish Peasants' Party (PSL), to remain in power until the next scheduled general election, in 2015. We forecast a further deceleration of real GDP growth in 2013, to 1.4%, because of the recession in the euro zone, weak domestic demand and sluggish investment expenditure. Owing to a combination of a weaker zloty and upward pressure on commodity prices arising from a bad harvest, average inflation reached 3.7% in 2012. Lower commodity prices, the absence of demand-pull inflation, and sluggish wage growth will contribute to the deceleration of inflation in 2013. The current-account deficit is expected to narrow in 2013 as a proportion of GDP as weak domestic demand squeezes import growth.
The government has a small but workable majority in parliament. However, the slowing economy is making the government deeply unpopular. This is likely to underpin the rising popularity of the main right-wing opposition party, Law and Justice (PiS), which will intensify its criticism of the government. The impact on political stability is however negligible as the government remains stable and strong.
The risk of fiscal slippage in 2013 remains high as economic growth continues to falter. Further rate cuts by the monetary policy council (MPC) of the central bank also remain a possibility, as inflation continues to fall faster than expected, helping to prop up domestic demand.
Country Forecast Poland Updater
Poland at a glance: 2013-17
OVERVIEW
Key changes from last month
Political outlook
Economic policy outlook
Economic forecast
Country forecast overview: Highlights
Country forecast overview: Key indicators
Country forecast overview: Business environment rankings
Country forecast overview: Poland's business environment at a glance
Policy towards private enterprise and competition
Policy towards foreign investment
Foreign trade and exchange controls
Taxes
Financing
The labour market
Infrastructure
Fact sheet
Outlook for 2013-17: Political stability
Outlook for 2013-17: Election watch
Outlook for 2013-17: International relations
Outlook for 2013-17: Policy trends
Outlook for 2013-17: Fiscal policy
Outlook for 2013-17: Monetary policy
Outlook for 2013-17: Economic growth
Outlook for 2013-17: Inflation
Outlook for 2013-17: Exchange rates
Outlook for 2013-17: External sector
Data summary: Global outlook
Data summary: Gross domestic product, current market prices
Data summary: Gross domestic product, at constant prices
Data summary: Gross domestic product by sector of origin
Data summary: Growth and productivity
Data summary: Economic structure, income and market size
Data summary: Fiscal indicators
Data summary: Monetary indicators
Data summary: Employment, wages and prices
Data summary: Current account and terms of trade
Data summary: Foreign direct investment
Data summary: External debt
Data sources and definitions
Global data
Domestic data
Abbreviations
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