Poland announced tighter anti-pandemic restrictions, including shutting preschools and nurseries, building materials stores and personal services. The government however stopped short of imposing strict lockdown seen in neighboring countries.

Registered unemployment rate in February was unchanged (6.5%). The average enterprise employment went up by 20 thous., mainly in manufacturing (+7 thous.) and retail trade (+8 thous.), reflecting strong external demand and the (unfortunately short-lived) reopening of shopping malls. Employment in hospitality, which is hardest hit by the pandemic, has declined by 17.2% y/y compared to the -1/7% y/y decline in total employment.

The M3 money supply growth in February slowed down to 16.3% y/y vs. 16.8% y/y January. The decline in term deposits is intensifying, while the growth of current deposits and cash in circulation weakened. The loan-to-deposit ratio fell to 81.3%, the lowest during the pandemic.

StatOffice data shed some light on industrial bottlenecks:

  1. passenger cars production declined once again in February in y/y terms, probably reflecting the shortage of components (although Brexit could have also played a role);
  2. the estimated domestic steel supply in January-February also decreased. Clogging of supply chains is also confirmed by data on industrial orders, where new export orders lag behind domestic ones (in February export orders + 0.7% y/y, while total industrial orders+ 3.7% y/y).

The weeks ahead:

CPI inflation in March could have bounced back from its February reading of 2.4% y/y to app. 3.0% y/y on the back of higher oil prices.

PMI has likely increased in March, following western counterparts, both on strong external demand and growing supply constraints.

Next Wednesday the NBP rates are likely to remain flat, despite the surge in new covid cases.

Number of the week:

-27.1% y/y– the decline in estimated value of the commenced investments in 4q20.

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