Poland’s flash CPI is expected to have remained negative on year-on-year
basis in August. According to a Societe Generale’s research note, flash CPI is
likely to have come in at -0.8 percent year-on-year in August, a slight
acceleration from -0.9 percent year-on-year in July. On a sequential basis, CPI
inflation is expected to have declined 0.2 percent in August.
The monthly
decline is mostly because of an impact of a seasonal drop in food prices, which
is expected to have declined 0.6 percent, and also a fall in transport prices.
Transport prices are expected to have fallen 0.7 percent month-on-month due to
1.5 percent decline in fuel prices. Within other components, prices of clothing
and footwear are expected to have declined 2 percent
month-on-month.
“We forecast softer deflation in September and the
end of deflation in December 2016”, added Societe
Generale.
Meanwhile, Poland’s current account deficit is expected to
have widened to about EUR 332 million in July from June’s deficit of EUR 203
million, stated Societe Generale. On a trade account, surplus is likely to have
come in at EUR 103 million. Imports and exports are expected to have dropped in
the month because of a 10.8 percent sequential decline in manufacturing in
July.
Export orders growth slowed in July to 6.7 percent year-on-year
from June’s 31.3 percent. Moreover, the country received EUR 453 million in
current transfers from the EU in July. Hence, primary income deficit might come
around EUR 1,394 million.
“There is also likely to be a surplus on
the services account of around €933m and on the secondary income account of
€26m, in our view”, noted Societe Generale.