Today in the country data on March retail sales and M3 money supply. We expect a strong retail sales reading – in our view the outbreak of war in the Middle East has prompted some consumers to stockpile purchases in fear of price increases (especially for fuels).
Moreover, Easter fell quite early in April and some holiday purchases were made still in March. In March there was also a pre-holiday shopping Sunday. Appetite for high readings also rose after good data from industry and construction. Overseas preliminary PMI indicators for major economies will be published.
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Macro data – upcoming releases
GUS reported that in 2025 the public finance sector deficit was 7.3% of GDP compared to 6.4% in 2024 and against a preliminary reading of 7.2% of GDP. Interestingly, the deficit estimate was revised upward, even though GUS also raised its nominal GDP estimates. The debt level was unchanged (59.7% of GDP).
According to the fiscal notification sent by the government to Brussels, this year the deficit will be 6.8% of GDP versus 6.5% of GDP set in the budget law.
This increase can only partly be linked to the fuel price reduction program. According to Finance Minister Andrzej Domański, the government will gradually reduce the deficit, but “it cannot happen at the expense of the economy”.
In our view, such a declaration and the fact that elections are held next year indicate that the deficit reduction will be only symbolic in the near future. The minister also said that by the end of April the assumptions for the extraordinary profit tax will be ready.
April business sentiment indicators from GUS showed deterioration in 6 of 8 reported sectors (after seasonality adjustment). This indicates increased concerns, most likely related to the conflict in the Middle East and the price shock in commodity markets, but so far there is little damage to current economic activity.
Almost all sectors reported greater concerns about business prospects, but at the same time the current situation was assessed more favorably than in March.
The industry index fell in April by far less than in March (-0.8 points versus -2.3 points) and is currently the lowest since August. The construction sector index has remained almost flat for five months.
After a rise in the second half of 2025, the retail trade index has fallen for the third month in a row. Its current level is not alarming, but it is worth checking whether the consumer confidence survey (published today) signals any negative trends beyond the preliminary reaction to the conflict captured in the March reading.
German Economy Ministry lowered its GDP growth forecast for this year in Germany to 0.5% from 1.0%, and to 0.9% in 2027 from 1.3% due to the effect of the conflict in the Middle East. Currently these are slightly pessimistic forecasts compared to the market, but recently market analysts have also lowered their expectations.
Euro EUR/PLN rate jumps to 4.24
On Wednesday the zloty weakened: EURPLN from 4.234 at the start of the session jumped to 4.244 at close. Other regional currencies fared better and were stable or recorded only minimal weakening. In our view today’s retail sales reading may support the domestic currency, although key will be potential news from US-Iran negotiations.
The domestic yield curve and IRS moved up by 3-4 points on Wednesday. On base markets, however, debt was stable and even recorded slight strengthening. We would link weaker results in the Polish debt market to the effect of good macro data from Tuesday, which may strengthen market bets on rate hikes in Poland.
