Fitch lowers Poland growth forecast to 5.2 pct

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Fitch lowers Poland growth forecast to 5.2 pct

In a report, the agency said Poland's GDP growth forecast for this year has been revised up to 5.2 percent from its previous estimate of 3.3 percent.

A higher starting point means that growth this year is likely to be 5.2 percent 3.3 percent before the expected slowing of the economy in the coming quarters, Fitch said.

The forecast takes into account the funding from the EU's Recovery and Resilience Facility RRF and the Polish economy will grow by 3.0 percent in 2023, lower than the previous forecast of 3.3 percent and will slow down to 2.3 percent in 2024, according to the agency.

The agency said real income will go down along with accelerating inflation, tighter monetary policy, trade disruptions and growing economic uncertainty.

Fitch said that the National Bank of Poland will have to tighten its policy because of the inflationary situation. The agency expects the central bank's reference interest rate to be at 7.0 percent at the end of the year and at 6.5 percent next year, with inflation at 11.0 and 7.5 percent at the end of the year.

Fitch highlighted the good situation on the Polish labour market and an increase in domestic consumption due to the influx of refugees from Ukraine as well as a strong wage hike of 12 percent in March PAP emer jchch.