After a growth deceleration in 2012-2013, an economic rebound in Poland is underway. The economy grew by 1.6% in 2013 as the slowdown in core euro area countries had knock-on effects on consumer and investor confidence in Poland. A steady recovery is now under way with growth expected to reach 3.1 percent in 2014, rising to 3.4 percent in 2015, on the back of strengthening domestic demand and falling unemployment, the International Monetary Fund (IMF) said in a report winding up its mission to Poland.
These forecasts mean that the Fund retained its 2014 growth forecast unchanged compared to the projections presented last month and inched up its 2015 forecast by 0.1pps.
IMF also said that inflation remains very low in Poland, partly reflecting external factors, and is projected to average only around 1% this year. It expects the figure to rise toward the 2.5% target as the output gap closes, but there are downside risks to this projection.
It also noted that Poland's strong trade and financial linkages with core euro area countries and significant energy imports from Russia make it vulnerable to growth shocks or a sharp increase in geopolitical tensions surrounding Russia/Ukraine, which could hamper the recovery.
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