WARSAW, Jan 24 (Reuters) - Poland's retail sales recorded
their deepest fall in almost eight years in December, decreasing
2.5 percent on an annual basis, signalling that the slowdown in
the largest central European economy will be deeper than
The data increases the chances that the central bank will
continue with its monetary easing after it cut rates by 25 basis
points for the third consecutive month in January.
RETAIL SALES (pct change) Dec 2012 Nov 2012
Year-on-year -2.5 2.4
Month-on-month 15.1 -6.4
Pct of workforce 13.4 12.9
* Analysts polled by Reuters expected retail sales
to rise 1.4 percent year-on-year last month and unemployment
rate at 13.4 percent.
The Polish zloty fell 0.23 percent immediately
after the data was released, while bond yields decreased by 2
basis points across the curve.
PIOTR PIEKOS, ANALYST AT BANK PEKAO SA:
'December's reading of retail sales is its lowest dynamics
since April 2005 and the first drop in nominal terms since April
'December data on retail sales are an important test of
consumer confidence due to Christmas expenses that are made in
'Today's data increase the probability of an interest rate
cut already in February. The latest statements by MPC members
imply that they are willing to support a motion on another rate
cut already at the next MPC meeting.'
PETER ATTARD MONTALTO, ANALYST AT NOMURA
'Another December data shocker. Most of the weakness was
seen in durable goods categories. The real question now is if
this is a short and sharp slump or long and deep one.
'We are still in the former camp and would say again that
the Monetary Policy Council is expecting nasty fourth quarter
data with a recovery in the first half.
'The zloty's reaction, though, should temper the possibility
of rates moving too low, especially if this sort of weakening
'The real rate argument still stands, too, independent of
GDP. Our Q4 GDP forecast shifts down now to 0.7 percent, which
would bring in full year GDP at 2.1 percent. We see 2013 GDP at
1.7 percent with weak H1 and recovery in H2.'
* Polish output plunges in December, more rate cuts seen
* Polish officials said weaker zloty would help economy
* Polish rate-setter Glapinski sees end of rate cuts
* Polish FinMin warns central bank against rate cut pause
* Poland cuts rates again but signals pause ahead
(Complied by Karolina Slowikowska; Reporting by Reuters Polish
Keywords: POLAND SALES/
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