Wage Growth Remains At Double-Digit Levels

Poland's economic activity data for May were mostly in line with forecasts, albeit industrial output proved somewhat disappointing. Wage growth narrowly missed expectations, but arguably remained way above the NBP's comfort zone.

• mBank note that the latest package of data was "weak," which does not bode well for Q2 economic growth (especially on the industrial side). Wages were also slightly softer, but measures of momentum remained solid.
• Pekao write that so far (1) they don't see any consumption boom, (2) the savings rate keeps rising, (3) the industry has not really hit the ground running. They still expect GDP to grow by 3% this year, with more dynamic growth expected in 2025. They note that wage growth remains way too high for the MPC to consider cutting rates, while momentum is cooling "very reluctantly."
  
• The Polish Economic Institute note that wages are rising the most in construction and services. They think that a double-digit pace of wage growth should be maintained through the year-end. They also point to the expected seasonal uptick in employment during summer holidays. Domestic industry slowed in May but remains resilient compared to other European countries and should gradually improve in the coming months. The PEI expect stabilisation in PPI, with changes reflecting mostly statistical effects.