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Markets News

UPDATE 1-Polish economy bounces back in third quarter

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GDANSK/WARSAW Nov 13 (Reuters) - The Polish economy rebounded in the third quarter, statistics office data showed on Friday, after shoppers returned and industry picked up, but analysts say any relief could be short-lived with a tough second wave of COVID-19 on the horizon.

Gross domestic product (GDP) rose a seasonally adjusted 7.7% for the July-September period from the previous quarter, slightly below the 8.0% forecast in a Reuters poll. In the previous quarter it fell 9.0%.

From a year earlier, GDP fell 1.6% compared with analysts’ expectations of a 1.7% contraction.

“It confirms what we have seen in other data that the third quarter was very good, the economy did not return to the pre-pandemic state, but it was quite close,” said Piotr Bielski, director of the economic analysis department of Santander Bank Polska.

Poland started easing coronavirus restrictions in May, and data for the third quarter showed a strong recovery in industry, while retail sales beat estimates as shoppers made purchases that had been delayed during the lockdown.

Friday’s statistics office data did not provide a breakdown of what was behind the quarter-on-quarter rise in GDP.

However, with the total number of COVID-19 infections more than quadrupling in the space of a month, the closure of entertainment venues and many shops and the spectre of even more restrictive measures hanging over the economy, the outlook for the fourth quarter looks bleaker.

“...This is history that is out of date,” Bielski said of the third quarter reading.

“After a good third quarter, in the fourth quarter we are most likely dealing with a decline in activity again, a decline in GDP quarter on quarter, ie the ‘second leg’ of the recession, hopefully a little shorter than the first.” (Reporting by Adrianna Ebert in Gdansk, Anna Wlodarczak-Semczuk in Warsaw; Writing by Alan Charlish; Editing by Jacqueline Wong)

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