Polish industrial output grew 7.5% y/y in August, data from statistical office GUS showed on September 20. The reading reveals a strong rebound from a 3.4% dip in July, which had cast some doubt over economic recovery in the third quarter following a disappointing first six months of the year.
In monthly terms, industrial production expanded as much as 3.3%. The figures come alongside strong retail sales results, and suggest the economy may finally be in with a chance of mounting a bid for sustained growth. The economy advanced a disappointing 3.1% in the second quarter, in similar vein to the first.
Industrial output in June was driven mainly by 9.4% y/y growth in the manufacturing segment, as well as a 5.4% expansion in the water and waste management sector. Those readings offset falls in other segments, including utilities - which dipped 9.4% - as well as mining and quarrying, which fell 2.8%.
Also marring the overall economic picture was the continued plummet in output in the construction sector. August data showed a fall of 20.5% on the year, attesting to slow investment dynamics, analysts note.
However, with output driven by rising export orders, many analysts exhibited a renewed sense of optimism. Yet the likes of BZ WBK are yet to be convinced. The potential for weaker demand for Polish goods in Germany is seen in the coming months, the bank's analysts point out. They also note calendar effects propped up the industrial production reading in August.
"While sales and industrial production may have done well in August, weak investments and exports growth slowing down will offset gains, and Polish GDP will not pick up speed in the coming quarters, remaining at about 3%,” BZ WBK claims in a note.