Poland Exports (G&S, ann. var. %)

Economy grows at softest pace since Q1 2021 in Q4

GDP growth slowed markedly to 2.0% year on year in the fourth quarter, from 3.6% in the third quarter. Q4’s reading marked the slowest expansion since Q1 2021.

Private consumption fell 1.5% in the fourth quarter, which contrasted the third quarter’s 0.9% expansion. Government consumption dropped at the sharpest pace since Q3 2022, contracting 1.6% (Q3: +0.1% yoy). Meanwhile, fixed investment growth rose to 4.9% in Q4, from the 2.0% expansion recorded in the previous quarter.

On the external front, exports of goods and services growth fell to 2.0% in Q4, marking the worst result since Q3 2020 (Q3: +6.9% yoy). In addition, imports of goods and services growth softened to 0.2% in Q4 (Q3: +6.0% yoy), marking the worst performance in over two years.

On a seasonally-adjusted quarter-on-quarter basis, economic activity dropped 2.4% in Q4, contrasting the previous quarter’s 1.0% increase. Q4’s reading marked the largest contraction since the outbreak of the Covid-19 pandemic in Q2 2020.

Commenting on the outlook, Rafal Benecki, senior economist at ING, stated:

“For the whole of 2023, we expect GDP growth in the vicinity of 1%, which until recently seemed an optimistic assumption. But the forecast is supported by improving global economic sentiment and less pessimistic expectations for the economic situation in Europe than seen earlier.”