Poland’s economy is expected to be “back at pre-pandemic levels next year” but high frequency data suggests the pace of the recovery is “really stalling,” Przemysław Kwiecień, The Chief Economist of XTB told PolandIN.
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The XTB economist said there was “nothing to celebrate” in Poland’s second quarter slump, but said that the same was true everywhere and compared with the UK and Spain which reported a 20 percent shrinkage of their economies, Poland was in a group of countries which avoided the worst of the COVID-19 recession because of its industrial base, which was more resilient than the service sector.
Looking ahead, he cautiously agreed with the opinion that the economy would be back in the black next year, but warned that when the effect of government stimulus measures runs out in two or three quarters, companies could start economising. Added to that, banks may constrain their credit and these two factors could lead to a second recession, a more benign but longer one.
Meanwhile, Mr Kwiecień said that the markets had moved on “from panic euphoria” in the spring, when investors realised that there was stimulus available that would stop companies going bankrupt.
“We avoided bankruptcies, but it is not known how companies will survive without stimulus in the long run. However, markets only look at the short term,” the XTB economist said.