Global rating agency Standard and Poor’s (S&P) has raised Poland’s economic growth forecast to 1.1% in 2023 from 0.9% expected earlier.
At the same time, S&P cut its forecast for 2024 by 0.2%, to 3.2%, the company stated in a report published on June 26.
According to the agency, after 2023, economic growth in Poland, especially in the area of investments and exports, will likely be supported by near-shoring, growth in the export of IT services and higher spending on armaments.
S&P expects inflation in Poland to return to the 1.5-3.5% target range “no sooner” than in 2025, but interest rate cuts are still expected to in 2023 amid fast disinflation.
The agency predicts that Poland’s Monetary Policy Council, the Polish central bank’s rate-setting body, will cut interest rates (currently at 6.75%) once before the end of 2023 by 25 basis points (bps), followed by a total of 125 bps cut over the course of 2024 – to 5.25% and another 175 bps in 2025 to 3.50%.
Poland’s average annual inflation (HICP) is now expected to hit 11.7% (down by 0.1% from the previous forecast in late March) and ease to 6.2% in 2024 (unchanged from the previous forecast).
On June 23, S&P declined to issue a scheduled report for Poland’s sovereign rating, which means the rating held at A- with stable outlook.
Among the three major rating agencies, Moody’s offers Poland the highest rating, on the A2 level. According to Fitch, Poland’s rating is A-. All three give Poland a “stable” outlook. (PAP/Business World Magazine)