What else caught our eye:
- The government announced new anti-epidemic restrictions as of Dec 15, with a marginal impact on economic activity, in our view.
- The EU paved the way for member states to cut VAT rate on basic food products to 0% for a period of 6 months without a prior EU Council approval. This leaves the opportunity for the government to slash CPI inflation further by 0.2-0.3pp, on our estimates (most likely in 1h22).
- A significant shortage of electricity last Monday (managed successfully by the grid operator via imports) has reminded of an overall structurally tight electricity supply in Poland.
- PFR head P.Borys believes that the terminal rate for Poland is 2-3%.
The week ahead:
- Detailed CPI figures for November will be the key local macro data release the week ahead. The headline inflation rate is likely to be confirmed at 7.7%, with core inflation edging up further to 4.6-4.7% (from 4.5% in Oct).
- Labour market data for November could be distorted by the pandemic due to record high number of people under quarantaine. Our forecasts are in line with consensus (for details see calendar, p.4).
- Balance of payments for October should show a narrowing of 12-month rolling CA surplus towards 0.0% of GDP, amid increased purchases of imported intermediate goods (just-in-case inventories build-up).