With the current pace of price and wage increases, this day was bound to come. In December 2023, for the first time, we exceeded an average wage of 8000 PLN. This happened exactly one year after we first exceeded 7000 PLN.
Wages are growing
The headline news of the day is certainly the rise of the average wage above 8,000 PLN gross for the first time in history. This only applies to companies employing more than 9 workers, but still, we are talking about an average for nearly 6.5 million working Poles. The bad news is that a wage increase of 11.9% was expected, and we saw 9.6%. It turns out that with the decline in inflation, budgets for raises and bonuses also fell. In the case of December salaries, it’s the bonuses that cause this one-time spike in this month. As a result, we should fall back below this threshold for several months in January. It’s worth remembering that it’s the lack of this 2% increase over expectations that caused the rate to be 8032 PLN, not around 8200 PLN. There’s also more good news. Employment fell by 0.1% instead of 0.2% annually. This probably means fewer layoffs are causing the lower wage increase. Companies often first reduce the least experienced workers.
Other data from Poland
Alongside employment data, there were also reports on industrial production and retail sales. Industrial production fell by 3.9% YoY, but this is a good result as a 5% drop was expected. So, it’s a positive surprise. However, retail sales only grew by 0.5%, which is a negative surprise as a 4.6% increase was expected. As a result, we had a clash of good and bad news at the same time. The market slightly overestimated retail sales, as the Polish zloty fell against major currencies. The euro rate rose by about 0.5 groszy after the release, so this wasn’t a significant change.
China does not change interest rates
The Chinese economy didn’t get caught up in all the Western fuss with interest rates and inflation. First, during the covid crisis, they didn’t drop interest rates to absurd levels, and they didn’t trigger inflation. Then they didn’t raise interest rates to fight it. As a result, over the past two years, we’ve dealt with 5 rate cuts totaling just 0.4% from 3.85% to 3.45%. This level was maintained at yesterday’s meeting. Looking at inflation, which has recently turned into deflation, there’s room for cuts, although it’s important to remember that this country has big problems with irrational debt, hence the higher rate serves as a safety valve.
There are no important economic data in today’s calendar.
Maciej Przygórzewski – Head Analyst at InternetowyKantor.pl and Walutomat.pl
