Poland: GDP slides at steeper pace in Q4
February 12, 2021
According to a preliminary reading, the economy shrank at a steeper rate in the final quarter of 2020, with GDP decreasing 2.8% year-on-year, below the 1.5% contraction tallied in the third quarter. The reading came in slightly above market analysts’ expectations of a 3.0% drop. On a seasonally-adjusted quarter-on-quarter basis, economic activity fell 0.7% in Q4, contrasting the previous period's 7.9% expansion.
While a detailed breakdown of the result is yet to be released, available data indicates household spending suffered in Q4 amid the resurgence of Covid-19 cases and the reimposition of containment measures. Retail sales contracted in the quarter, while consumer sentiment deteriorated. Meanwhile, depressed business confidence and uncertainty regarding the trajectory of the pandemic likely weighed on investment activity in the fourth quarter.
Commenting on the outlook for the Polish economy, Kevin Daly and Tadas Gedminas, economists at Goldman Sachs, reflected:
“Although the second pandemic wave in Poland was more severe than in spring, the economic impact of second-wave lockdowns appears more limited. This is not unique to Poland, and economies across CEEMEA have shown resilience (e.g., Russia and the Czech Republic). Looking ahead, while uncertainties remain surrounding the pace of vaccinations and the precise timing of a broad economic reopening, we maintain our baseline expectation of a sharp rebound this year. Indeed, Poland has begun a gradual reopening, allowing shopping malls and cultural venues to reopen with reduced capacity from February 1, as well as hotels, entertainment venues and outdoor sport facilities from February 12.”
Author: Hanna Andersson, Economist