Retail Sales, Construction Output Add To Series Of Disappointing Releases

Local sell-side desks released their snap reaction after Poland's real retail sales shrank 4.0% Y/Y in July versus -3.6% expected and -4.7% in June. Construction output also disappointed, rising 1.1% Y/Y versus +2.6% expected and +1.5% in June.

• ING note that retail sales was yet another disappointing July data outturn. In their view, the real purchasing power of Polish consumers is starting to recover only now after almost a year of losses.
• mBank write that Poland's economy is having a sluggish start to Q3. They observe that an improving consumer sentiment is not translating into any widespread recovery in retail spending. They note that domestic demand remains "not to strong" despite continued tightness in the labour market, with household still preferring to delay spending.
• Pekao comment that "it seems that the worst in consumption is behind us," with the economy recovering from a Q2 trough. They single out a rebound in durable goods sales (ex-auto) as a positive sign. Pekao reaffirm their 2023 GDP forecast of +0.4% Y/Y.