In another sign of the Polish economic slowdown, Poland’s Central Office of Statistics (GUS) recorded a fall of 3.6 percent in retail sales between January and February. The largest fall was in the sale of fuel (26.2 percent). Sales of furniture and electrical goods also fell markedly (10.3 percent), while food sales fell by 4.6 percent.
There were sectors where sales were up. Textiles and footwear recorded a rise of 9.9 percent, whereas motor vehicles and parts rose by 7.5 percent. Pharmaceuticals and cosmetics sales also rose by a modest 2.7 percent.
According to analysts from Poland’s state bank PKO BP, because of the decline in the value of Polish incomes due to inflation, retail sales and industrial production are likely to fall further. However, the reduced demand for goods should help slow inflation in the coming months.
Experts note that the buoyant labor market in Poland was helping to shore up demand in the economy, but the recent rises in food and energy prices have reduced people’s spending power. Higher interest rates have also caused mortgage repayments and credit financing to take up more of people’s disposable incomes.
Poland’s economic pundits are therefore expecting further drops in retail sales to continue in the first half of the year. However, they are hopeful that as a result of a fall in the inflation rate, sales will pick up in the second half of 2023 and enhance economic growth.
Recent GUS data on incomes and employment have not brought any surprises. The number of people employed rose by 0.8 percent compared with a year ago but fell 0.1 percent in January of this year. The average income in Poland rose by 13.6 percent compared to last year, even though the overall value of incomes fell by 2.1 percent as a result of inflation.