Unexpectedly, we find ourselves in a situation where wages are growing over three times faster than inflation. However, we should not assume that this situation will last long. The industry is performing poorly in the background.
Wages are Rising
Yesterday’s data shows that wages are growing year-on-year by 12.8%, which is significantly better than expected. However, there is a downside to this news. Employment is dropping by 0.2%. In such situations, those with lower qualifications often lose their jobs first, which means that the experience, and often the salary, of those who remain become higher on average. It’s also worth noting that despite this increase, the average salary is 7768.35 zł, which may be surprising because in December the average salary was over 8000 zł. The question remains, how can it grow if it has dropped? The key lies in the reference point – yearly. We compare December to December a year earlier, and January to January a year earlier. December peaks are often due to the payout of Christmas or yearly bonuses. If the current pace of wage increases continues around April-May, we should see the level reach 8000 zł again.
Industrial Production is Slowing Down
Yesterday, we also learned about industrial production in Poland. It is growing by 1.6% per year. Yes, this is just a little for this indicator. On one hand, the expectation was 3.1%, which objectively makes this a bad result. On the other hand, there was not a single month last year when there was more. Countries at our level of development usually have a much higher indicator. On the other hand, the average for the European Union and the eurozone is even lower. This allows us to look more favourably at this result. Yesterday’s strengthening of the Polish currency, however, was not triggered by this data but by changes in global markets and the inflow of capital to Europe.
Canada is Different Than The US
Data on price growth in North America is a hot topic. We remember last week, when the USA did not meet investor expectations. Yesterday’s data from Canada showed an unexpected drop not of 0.1%, but of 0.5%. This is the second lowest result in recent years. The previous one took place in June, but then inflation had what some analysts describe as a yo-yo effect. The markets responded with a very rapid sell-off of the Canadian dollar. This was due to changes in expectations regarding interest rate cuts. The more investors expect lower rates, the weaker the currency, because investments will earn less.
Maciej Przygórzewski – Chief Analyst at InternetowyKantor.pl and Walutomat.pl.
