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Poland Keeps Up Jobs Pace, Wages Slow Amid Rate-Rise Calls

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April 18 (Bloomberg) -- Polish job growth at companies with more than nine workers held steady and corporate-wage increases decelerated in March, suggesting the European Union’s biggest eastern economy isn’t gaining strength and damping calls for higher borrowing costs.

Corporate employment rose 0.5 percent from a year earlier, the same rate as in February, the Central Statistical Office in Warsaw said today. That matches the median estimate of 27 economists in a Bloomberg survey. Hiring fell 0.1 percent from the previous month.

Economic growth in Poland, the only EU member to dodge a recession in 2009, will slow to 2.5 percent this year from an estimated 4.3 percent in 2011 as the euro-region debt crisis curbs exports demand, the government forecasts. Labor-market and industry data this week “should be enough” to decide whether to leave interest rates unchanged for an 11th month in May, central banker Anna Zielinska-Glebocka said April 14.

“I don’t think these figures will change any Monetary Policy Council members’ views on what’s needed in the May meeting,” Mateusz Szczurek, chief economist for eastern Europe at ING Groep NV in Warsaw, said by phone after the release. “Our view is that the hike will be delivered in May -- the reason we think so is Belka’s rhetoric of late.”

‘Will Consider Tightening’

The central bank “will consider tightening monetary policy in the nearest future, unless signs of considerable economic weakening in Poland appear and the outlook for inflation returning to the target does not improve,” Governor Marek Belka told an April 4 news conference after keeping rates unchanged.

The zloty, the world’s second-best performer against the euro this year among currencies tracked by Bloomberg with a 6.8 percent advance, was 0.3 percent weaker at 4.1828 at 2:31 p.m. in Warsaw. The yield on Poland’s two-year government bond was little changed after the announcement, trading 2 basis points higher than yesterday at 4.751 percent.

Industrial-output growth probably slowed to 4.4 percent from a year earlier in March, compared with 4.6 percent in February, according to the median estimate of 30 economists surveyed by Bloomberg News. That would be the second monthly deceleration and the slowest pace since last July. The statistics office will report the data tomorrow.

Citigroup Inc.’s Polish unit Bank Handlowy SA said March 19 it will cut 11 percent of its workforce and close 40 percent of its retail branches this year to lower costs as the economy slows. Bank BPH SA, a lender owned by General Electric Co., plans to eliminate as many as 600 jobs by the end of November as it seeks to reduce costs to 60 percent of income in 2015, it said in an April 17 regulatory statement.

Average gross wages rose 3.8 percent from a year earlier in March after a 4.3 percent surge the previous month, matching the median forecast of 28 economists surveyed by Bloomberg. Wages rose 5.7 percent from February.

To contact the reporter on this story: Aaron Eglitis in Riga at

To contact the editor responsible for this story: Balazs Penz at

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