WARSAW, Poland – Poland's economy, which has steamed ahead for years in defiance of trouble elsewhere in Europe, made a sudden slowdown in the second quarter of this year as Polish consumers and businesses spent less, according to new data published Thursday.
The state statistical office said the economy grew 2.4 percent year-on-year in the April-June period, a much weaker rate than experts had expected. The figure raises the chances of an interest rate cut in coming months.
The largest of the European Union's ex-communist members, Poland grew 4.3 percent in 2011 before slowing to 3.5 percent year-on-year in the first quarter of this year. Several economists and the central bank head had forecast around 2.9 percent growth for the second quarter.
Growth in the spring was expected to be stronger because the country was in the final stages of preparing to co-host the Euro 2012 football championship, an event that spurred massive construction of roads, stadiums and other infrastructure. A sharper slowdown was expected but not until later in the year — a weakening seen as inevitable because Poland's main trade partners are all hurting due to the eurozone financial crisis.
Piotr Bujak, chief economist in Poland for Nordea Markets, said that the second quarter growth "proved much weaker than expected." He called it "quite shocking" given the resilience Poland showed during the earlier global crisis of 2008-2009, when it was the only EU country to avoid recession.
Bujak and other economists attribute much of the slowdown to a sharp decline in domestic demand. It shrank 0.2 percent year-on-year, in the first yearly decline since 2009.
Thursday's numbers suggest the economy is "slowing rapidly," said Adam Antoniak, economist with Bank Pekao SA in Warsaw. He said they prompted his bank to lower its yearly GDP forecast for 2012 from 3 percent to 2.6 percent.
That's still a favorable place given that others in the region, including Hungary and the Czech Republic, are in recession. Still, slower growth will delay Poland in its struggle to achieve a Western European standard of living.
"Today's GDP data are disappointing, but they are by no means a disaster," said London-based Capital Economics. "Poland remains one of the strongest performers in emerging Europe, and one of the most resilient economies to the euro-crisis."