An anticipated increase in Polish industrial production figures in May failed to materialize as output fell 1.7% year on year.
Analysts polled by state news agency PAP had forecast a rise in output. The key factors contributing to the poorer-than-hoped-for figures were falls in the production of semi-finished and industrial goods.
br> “Industry right now is suffering and will continue to suffer from the lack of orders from the West,” Mariusz Zielonka, an economist from the Lewiatan Confederation, an employers’ organization, told PAP.
Poland’s main export market for its industrial goods, as well as other items, is Germany, which has suffered a downturn in recent months.
A bright spot in the figures is, however, car production, which has remained buoyant over the past few months.
One factor which explains the drop in overall production is that there were fewer working days this May compared to the same month last year. When corrected for seasonal factors, the result for the month was 0.7% ahead of the May 2023 figures.
Pekao bank analysts pointed out that 19 out of 24 manufacturing sub-categories faced a difficult month. Electrical equipment production was down the most - by some 29%.
The Polish Economic Institute, a government think tank, is confident that the climate for the industrial sector will improve in the summer months.
“Strong wage growth will stimulate consumption and increase demand for goods,” the institute said in a report on manufacturing.
It added: “Cost pressure remains low, and industrial prices dropped in May by 7% on an annual basis, and this price level is similar to the period before the outbreak of the full scale war in Ukraine.”
Zielonka from Lewiatan was less optimistic about consumer spending leading industry out of the doldrums. “Let’s be honest, the increase in domestic consumption is also below expectations,” he said.
br> “Industry right now is suffering and will continue to suffer from the lack of orders from the West,” Mariusz Zielonka, an economist from the Lewiatan Confederation, an employers’ organization, told PAP.
Poland’s main export market for its industrial goods, as well as other items, is Germany, which has suffered a downturn in recent months.
A bright spot in the figures is, however, car production, which has remained buoyant over the past few months.
One factor which explains the drop in overall production is that there were fewer working days this May compared to the same month last year. When corrected for seasonal factors, the result for the month was 0.7% ahead of the May 2023 figures.
Pekao bank analysts pointed out that 19 out of 24 manufacturing sub-categories faced a difficult month. Electrical equipment production was down the most - by some 29%.
The Polish Economic Institute, a government think tank, is confident that the climate for the industrial sector will improve in the summer months.
“Strong wage growth will stimulate consumption and increase demand for goods,” the institute said in a report on manufacturing.
It added: “Cost pressure remains low, and industrial prices dropped in May by 7% on an annual basis, and this price level is similar to the period before the outbreak of the full scale war in Ukraine.”
Zielonka from Lewiatan was less optimistic about consumer spending leading industry out of the doldrums. “Let’s be honest, the increase in domestic consumption is also below expectations,” he said.
Source: TVP World, PAP, GUS
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