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Polish Retail Sales Rise For First Time In 2023 In October

By Reuters
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Polish Retail Sales Rise For First Time In 2023 In October

Polish retail sales were in positive territory in October for the first time this year and were also higher than expected, potentially signalling a rebound in consumption and a positive factor for economic growth.

Retail sales rose by 2.8% year-on-year at constant prices in October. Analysts polled by Reuters expected an increase of 1.6%.

"This is due to the late arrival of the (more expensive) autumn-winter collections in stores (after a warm September) and increased fuel sales (due to still low prices)," wrote analysts from Pekao SA bank on the X platform.

The growth rate of fuel sales was almost 17% in October.

'Consumer Power'

Retail sales combined with high wages, which increased by 12.8% year-on-year in October, confirmed the "consumer power", analysts said.

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"Today's data confirm that the slowdown in consumption in Poland is over and is currently entering the recovery phase," Monika Kurtek, chief economist of Bank Pocztowy, wrote in a research note.

"The increase in consumption will translate into a dynamic acceleration of GDP, the growth rate of which in the last quarter of this year may amount to 1.5-2.0% y/y, and in the entire next year it may be around 3.0%."

Kurtek's view is that Wednesday's sales data, combined with Tuesday's information on wages, "strongly" support keeping interest rates at the current level in the coming month.

Earlier this month, the Monetary Policy Council kept the main interest rate unchanged at 5.75%, surprising most analysts who expected a 25-basis-point cut after a total of 100 bp of cuts in September and October.

Elsewhere, Rabobank recently said that consumers can expect some relief from food inflation next year, with the price of key staples such as sugar, coffee, corn and soybeans set to ease as supplies adjust higher in response to three years of soaring prices.

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