Moody's upholds Poland's GDP growth forecast for 2019 at 4.4 percent

Global ratings agency Moody's has maintained its forecast of Poland's GDP growth in 2019 at 4.4 percent and in 2020 at 3.7 percent, Moody's said in a Wednesday report on the country's macroeconomic profile.

Poland's growth will be driven by domestic consumption, with a strong inflow of EU funds, the agency said.

Solutions proposed by the government, including a reduction of the basic personal income tax rate from 18 percent to 17 percent and the extension of the 500+ child benefit programme are conducive to an increase in household spending, according to the report. According to the agency, Poland's macroeconomic profile is supported by the strength of its economy and its institutions.

The agency’s October rating decision for Poland is due on Friday. Asked in September whether the verdict of the European Court of Justice regarding foreign currency loans announced last week would have a bearing on Poland’s financial stability, the agency said it was too early to say.

In April Moody’s kept Poland’s rating at A2, with a stable outlook, which reflected their view that “risks to its credit profile are balanced, with robust growth prospects.” The agency was concerned at that point about “challenges to institutional strength as well as that fiscal metrics will comply with national and the EU's fiscal rules.” Making Wednesday’s forecast the agency also pointed out its concerns about the effects of the 2016 judicial reform.

Moody's forecast for GDP growth comes on the heels of the World Bank’s upgrade of its forecast for 2019 growth to 4.3 percent