Poland International Reserves (EUR bn)

Year-on-year GDP growth slowed further in the fourth quarter of 2022. A sizable drop in private consumption—amid spiking inflation, higher interest rates, downbeat sentiment and weaker export growth—was behind the deceleration. On the other hand, fixed investment expanded at a faster pace, supporting the economy. Meanwhile, GDP contracted significantly quarter on quarter. Moving to Q1, although the economy is expected to contract in year-on-year terms due to a high base of comparison, underlying momentum should have strengthened. Less downbeat consumer and business sentiment, as well as rising manufacturing PMI readings, in January-February point to stronger activity. Meanwhile, in late February S&P Global Ratings affirmed the country’s “A-” credit rating with a stable outlook, citing its diversified economy, NATO and EU membership and manageable levels of public and private debt.