Macroeconomic factors

After reaching a cyclical ‘low point’ in the first quarter of 2013 (GDP growth by 0.5% y/y) and a slight acceleration in the second quarter (to 0.8% y/y), as expected, in the second half of the year, the economy entered the path of recovery (growth in the third quarter by 1.9% y/y and in fourth quarter by 2.5 - 3% y/y). Together with the improvement in activity in the second half of the year, the change of the economic growth factors was continued. In the second half of the year the role of domestic demand increased, as a result of a gradual improvement in consumer and investment demand. Despite an increase in the import-intensive component of the domestic sale, sustained (throughout the year) strong export favoured positive contribution of net export to growth. The total GDP growth rate amounted to 1.6% in 2013 compared with 1.9% in 2012. 

Given the slower GDP growth rate in 2013, the decrease in the employment rate in the corporate sector by 1.0% y/y, compared with the increase by 0.1% in 2012 was recorded, whereas the registered unemployment rate per annum has not changed and amounted to 13.4% in December 2013. The increase in wages and salaries in the corporate sector decreased to 2.9% in 2013, compared with 3.4% in 2012.

GDP and its components growth rate (%, y/y)

Unemployment and employment rate (end of period, %)

In 2013, the average annual inflation rate, measured with the consumer price index, decreased to 0.9% y/y from 3.7% y/y in 2012. The downward trend was particularly strong in the first half of the year and led to a drop in inflation to a historically low level of 0.2% y/y in June

After the increase in July due to one-off factors (waste disposal prices, changes in the methodology of the Central Statistical Office) inflation reached 1.1% y/y in July and began falling again, amounting to 0.7% y/y in December.

In accordance with the ‘Monetary Policy Guidelines for 2013’ the objective of the monetary policy was to maintain inflation at 2.5% with an acceptable fluctuations range of +/-1 pp. Due to inflation remaining below the lower limit of the range, the Monetary Policy Council (RPP – Rada Polityki Pieniężnej) decided to extend the cycle of easing the monetary policy, to finally end it in July with decreases totalling -225 b.p. (including a -175 b.p. decrease in rates in 2013). The reference rate is now 2.50%. RPP announced that this situation would continue at least until the end of the first half of 2014.