Polish budget balance should see an unusually strong deficit for this time of year
The budget balance data should provide a strong reduction of the PLN 9.5bn surplus accumulated after June, as indicated by Deputy FinMin Leszek Skiba. A deficit in the central budget is an exception in July – historically there were rather limited changes this month. The most significant thing should be the structure of expenditures; a deficit could be a result of earlier payments of funds that are typically spent in the fourth quarter.
Moreover, the second GDP reading should confirm 5.1%YoY dynamics in 2Q. We expect a moderation of private consumption from 4.8% to 4.5%YoY, solid investment growth (closing in on 10%YoY) and modest net export surplus - approximately 0.1pp.