CEE & CCA week ahead: Polish industry and labour market data, Czech producer prices in focus
This week's focus on Polish and Czech macroeconomic data is critical for gauging economic sentiment in Central and Eastern Europe, especially given the implications for monetary policy. Per the full note source, July industrial output in Poland is expected to show steady growth driven by increasing investments, while PPI is projected to rise due to input cost pressures exacerbated by a weaker koruna. Additionally, cooling labour market dynamics could temper inflationary pressures, aligning with observed trends across the region. The consensus now emphasizes that soft labor conditions are likely to maintain a lid on broader inflation concerns, pushing back aggressive monetary tightening scenarios from the central banks involved.
What the desk is arguing
The desk asserts that Polish industrial growth and softening labour statistics could influence the zloty (PLN), presenting a mixed picture for investors. Key indicators to watch include the upcoming data on industrial output and wage growth expected on Thursday, which may reflect a resilient but cooling economy. Per the full note source, a modest rise in PPI inflation to 2.0% YoY underlines persistent input cost pressures but suggests limited pass-through effects on consumer inflation.
Moderate wage growth expected below 6% YoY, coupled with declining employment figures, will be critical in understanding the balance of inflationary pressures in Poland. The prospect of ongoing investment growth supported by the Recovery and Resilience Facility should ideally provide a counterweight to the cooling labor market.
Where it sits in our coverage
Given the absence of specific internal consensus targets for this analysis, we refrain from citing multi-firm perspectives on the zloty.
How other firms see it
While there is no concentrated view across firms, higher inflationary expectations could see divergence in sentiment, especially if Czech producer prices surprise to the upside. bofa is particularly concerned with potential downside risks, speculating that rising costs could prompt a more defensive stance from the regional central bank. Conversely, jpmorgan’s views align with a more optimistic outlook focused on recovery momentum.
What the calendar says
With no immediate high-impact events scheduled, traders should remain attentive to the labor market data and PPI releases set for Thursday, which could provide important insights into the direction of monetary policy across Central and Eastern Europe.
How firms align with this view
Aligned with the desk view
Contrary positioning
Key takeaways
- 01Poland's industrial output expected to remain steady, supported by investment growth.
- 02Czech PPI likely to rise due to input cost pressures and a weaker koruna.
- 03Cooling labor market may limit inflationary wage pressures, keeping monetary policy stable.
- 04Central banks expected to monitor labor and price data closely for any significant shifts.
Market implications
Watch for the Polish zloty's response to Thursday's industrial output and wage growth reports. A significant deviation from the projected numbers could shift market sentiment around Poland's economic resilience and monetary policy outlook.
Risks to this view
Any unexpected spike in wage growth or inflation could force central banks to reconsider their current policy stances, potentially leading to a more aggressive tightening response. Additionally, geopolitical tensions that affect energy prices could complicate inflation dynamics.
Articles CEE & CCA week ahead: Polish industry and labour market data, Czech producer prices in focus Published 15:45 Share X LinkedIn E-mail Copy link Share X LinkedIn E-mail Copy link Download Polish industrial output, wages and PPI data will be in focus next week, alongside Czech producer prices Adam Antoniak and David Havrlant Warsaw, Poland Poland: Industrial momentum to remain steady as labour market cools Thursday brings July industrial output growth. In the absence of any calendar effects, with July 2026 having the same number of working days as in 2025, and with no significant one-off factors identified, we expect it to have remained moderate. Industrial activity has been performing somewhat better than at the start of the year and should continue to gain momentum as investment growth accelerates and projects financed under the Recovery and Resilience Facility (RRF) move into full implementation.
PPI inflation is likely to have risen to 2.0% year-on-year. While producer prices were broadly unchanged from June, a favourable base effect is expected to have pushed up the annual rate. We will also get July labour market data on Thursday.
We still expect moderate wage growth, probably below 6% YoY, to be accompanied by a further decline in employment in the enterprise sector. The cooling labour market and the absence of significant wage pressures are among the factors helping to keep underlying inflation contained, despite the increase in petrol and diesel prices resulting from tensions in the Middle East. In our view, softer labour market conditions should continue to limit the pass-through of higher energy costs into broader consumer prices, thereby preventing a more persistent build-up of inflationary pressures across the economy.
Czech Republic: Producer prices set to rise on higher input costs On Monday, July producer prices are released. We expect an increase on the back of rising prices of basic materials, also supported by a weaker koruna against the dollar. That said, the annual pace likely remained subdued, as harsh foreign competition puts a lid on the ability to pass through increasing input costs to final prices.
Key events in CEE & CCA next week Source: Refinitiv, ING "> Source: Refinitiv, ING Content Disclaimer This publication has been prepared by ING solely for information purposes irrespective of a particular user's means, financial situation or investment objectives. The information does not constitute investment recommendation, and nor is it investment, legal or tax advice or an offer or solicitation to purchase or sell any financial instrument. Read more Share X LinkedIn E-mail Copy link Share X LinkedIn E-mail Copy link Download Authors Adam Antoniak Senior Economist, Poland Adam has about 20 years of experience in macroeconomic research.
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