Polish job growth at companies with more than nine workers slowed and corporate-wage increases decelerated in February, suggesting the European Union’s biggest eastern economy has begun to weaken.
Corporate employment rose 0.5 percent from a year earlier compared with 0.9 percent in January, slowing for a seventh month in eight, the Central Statistical Office in Warsaw said today. That’s below the 0.6 percent median estimate of 22 economists in a Bloomberg survey. Hiring fell 0.1 percent from the previous month.
Poland was the only EU member to dodge a recession in 2009. Economic growth will slow to 2.5 percent this year from an estimated 4.3 percent in 2011 as the euro region, which buys more than half of Polish exports, grapples with a debt crisis, the government forecasts.
“Today’s data will be important for the Monetary Policy Council as they confirm the jump in wage growth in January was a one-time occurance and that there’s no wage pressure,” Monika Kurtek, chief economist at Bank Pocztowy in Warsaw, said after the release. “I expect interest rates to remain unchanged.”
The central bank left its benchmark interest rate at 4.5 percent for a ninth month on March 7, after increasing borrowing costs by a percentage point in the first half of last year to combat inflation. The likelihood the National Bank of Poland will cut interest rates is increasing as economic growth slows, Elzbieta Chojna-Duch, a member of the bank’s rate-setting Monetary Policy Council, said in an interview this month.
The zloty fell against the euro after the data release and traded at 4.1299 as of 2:15 p.m. in Warsaw from 4.1228 at yesterday’s close. The yield on the five-year bond maturing in October 2016 rose to 4.912 percent from 4.876 percent yesterday.
“Employment indicators in the National Bank of Poland surveys worsened, indicating demand for work will weaken during the first quarter,” the central bank said in a March 12 inflation report.
Debica SA, a Polish tire manufacturer controlled by Goodyear Tire & Rubber Co., said yesterday it will lower production in March because of weaker European demand. Steelmaker Arcelormittal Poland SA has begun a plan to cut its workforce by 1,000, the Prime Minister’s Economic Council said today in its daily bulletin.
Average gross wages rose 4.3 percent from a year earlier in February after an 8.1 percent surge the previous month, less than the 5.3 percent median forecast of 24 economists surveyed by Bloomberg. Wages fell 2.7 percent from January.