Post on 27-Jul-2020
transcript
Economic Institute
Warsaw / 13 July 2015
Inflation projection of Narodowy Bank Polski
based on the NECMOD model
Introduction
Changes between
rounds
Projection 2015 - 2017
Uncertainty
Outline:
Inflation projection of the NBP based on the NECMOD model 2
1 Changes between projection rounds
2 Projection 2015 - 2017
3 Uncertainty
Outline
Introduction
Changes between
rounds
Projection 2015 - 2017
Uncertainty
Outline:
Inflation projection of the NBP based on the NECMOD model 3
Changes between projection rounds
Changes in the projection assumptions
July projection compared to March projection
Inflation projection of the NBP based on the NECMOD model 4
■ External environment:
■ Forecast for GDP growth abroad revised slightly upwards.
■ Higher forecast of global agricultural commodities prices, although still at their
historically low level.
■ GDP data for 2015Q1 above expectations from the March projection, with a
sharper growth in gross fixed capital formation, a high positive contribution of
net exports, outweighed by a strongly negative contribution of changes in
inventories.
■ Higher dynamics of employment and nominal wages in 2015Q1.
■ Lower than expected domestic food prices inflation (the effect of stronger
impact of high supply of agricultural commodities on food prices in Poland).
■ NBP reference interest rate lower by 50 p.p.
Changes in the projection assumptions
Inflation projection of the NBP based on the NECMOD model 5
-1
0
1
2
3
4
5
6
7
8
-1
0
1
2
3
4
5
6
7
8
12q1 12q3 13q1 13q3 14q1 14q3 15q1 15q3 16q1 16q3 17q1 17q4
y/y, % 90% 60% 30% Mar 15 Jul 15
July GDP projection compared to March projection
-1.5
-1.0
-0.5
0.0
0.5
1.0
1.5
-1.5
-1.0
-0.5
0.0
0.5
1.0
1.5
2015 2016 2017
Change in inventories Net exports
Gross fixed cap. formation Public consumption
Private consumption GDP
Inflation projection of the NBP based on the NECMOD model 6
July CPI inflation projection compared to March projection
-2
-1
0
1
2
3
4
5
-2
-1
0
1
2
3
4
5
12q1 12q3 13q1 13q3 14q1 14q3 15q1 15q3 16q1 16q3 17q1 17q4
y/y, % 90% 60% 30% Mar 15 Jul 15 inflation target
-0.6
-0.4
-0.2
0.0
0.2
0.4
0.6
0.8
-0.6
-0.4
-0.2
0.0
0.2
0.4
0.6
0.8
2015 2016 2017
Core inflation Food prices
Energy prices CPI inflation
Introduction
Changes between
rounds
Projection 2015 - 2017
Uncertainty
Outline:
Inflation projection of the NBP based on the NECMOD model 7
Projection for 2015-2017
Projection scenario
Economic conditions abroad
Aggregate demand
Inflation
Inflation projection of the NBP based on the NECMOD model 8
■ Economic growth based on increasing consumption and private investment, while net exports
remain negative.
■ Private consumption growth supported by good situation on the labour market and low price
dynamics.
■ Output gap closing gradually (negative since mid-2012) and remaining close to zero in 2016-
2017.
■ Low energy commodities prices on the global markets.
■ Deflation in most quarters of 2015, afterwards positive price dynamics however below the
inflation target.
■ The CPI inflation growth in the longer term will be hampered by low demand pressure, low
import prices resulting from only a moderate economic recovery in the euro area and low
commodity prices on the global markets.
Projection scenario
Introduction
Changes between
rounds
Projection 2015 - 2017
Uncertainty
Outline:
Inflation projection of the NBP based on the NECMOD model 9
Economic conditions abroad
Inflation projection of the NBP based on the NECMOD model 10
GDP in the euro area in 2015Q1
Change in GDP (%, q/q) GDP in 2015Q1 (%, q/q)
Source: Eurostat, Bloomberg
• Private consumption remain the main source for GDP
growth.
• Negative contribution of net exports to growth in most
countries of EA.
• Lower GDP growth than expected in Germany in
2015Q1, mainly due to lower inventories.
• However in many countries (FR, IT, ES) economic
growth above market expectations.
-1.0
-0.5
0.0
0.5
1.0
1.5
EA DE FR IT ES NL
Public consumption Private consumption
Gross fixed capital formation Changes in inventories
Net exports GDP
-0.2
0.0
0.2
0.4
0.6
0.8
1.0
EA DE FR IT ES NL
2014Q3 2014Q4 2015Q1 Market consensus for 15q1
Inflation projection of the NBP based on the NECMOD model 11
The situation of households in the euro area
• Private consumption in the euro area supported by the
ongoing improvement on the labour market.
• The rise in employment expected in the forecast horizon
will be the main driving force of the wage fund increase,
while no wage pressure is foreseen (in the environment of
low inflation and decreasing, although still high rate of
unemployment).
Source: Eurostat, Ameco
-1.0
-0.5
0.0
0.5
1.0
1.5
2.0
2.5
2010 2011 2012 2013 2014 2015 (f) 2016 (f)
Structure of compensation of employees real growth, %
Employees, persons Real wages per employee
Compensation of employees
-1.0
-0.5
0.0
0.5
1.0
2012 2013 2014 2015
Sectoral structure of employment growth (y/y, %)
Agriculture, forestry and fishing Industry (except construction)
Construction Services
Total employment -3
-2
-1
0
1
2
3
4
2007 2008 2009 2010 2011 2012 2013
Growth of gross disposable income in the euro area (y/y, %)
Nominal growth of the adjusted gross disposable income per capita
Real growth of the adjusted gross disposable income per capita
Inflation projection of the NBP based on the NECMOD model 12
Investment outlays of enterprises in the euro area
Source: AMECO, Eurostat
Unfavourable factors for investment:
• uncertainty,
• low rate of demand growth,
• demographic factors,
• ongoing residential market adjustments on the majority of big economies.
The increase in investment outlays in the euro area will remain
moderate in the short-term.
40
45
50
55
60
65
2010 2011 2012 2013 2014 2015
PMI Composite (3-month average)
EA DE FR IT ES
-2.5
-2.0
-1.5
-1.0
-0.5
0.0
0.5
1.0
2012 2013 2014 2015
Sectoral structure of investment growth in the euro area (q-o-q, p.p.)
Total Construction (gross) Other investment
Gross fixed capital formation
Inflation projection of the NBP based on the NECMOD model 13
Investment outlays of enterprises in the euro area
18%
19%
20%
21%
22%
23%
24%
2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015
Rate of investment in the euro area (% GDP)
Source: Eurostat
-15%
-10%
-5%
0%
5%
10%
15%
2011 2012 2013 2014 2015
Investment outlays growth in main euro area economies (y/y)
EA DE ES FR IT
Inflation projection of the NBP based on the NECMOD model
4
5
6
7
8
IV I II III IV I II III IV I II III IV I II III
2016 Indie 2011 2012 2012 2013
dane rzeczywiste prognoza Bloombergactual data Bloomberg forecast
14
Emerging economies GDP growth (%, y/y)
China Russia Brazil
-2
-1
0
1
2
3
4
5
-2
-1
0
1
2
3
4
5
I III I III I III I III I III I III
2011 2012 2013 2014 2015 2016
-6
-4
-2
0
2
4
6
-6
-4
-2
0
2
4
6
I III I III I III I III I III I III
2011 2012 2013 2014 2015 2016
6
7
8
9
10
11
6
7
8
9
10
11
I III I III I III I III I III I III
2011 2012 2013 2014 2015 2016
3
4
5
6
7
8
9
3
4
5
6
7
8
9
II III IV I II III IV I II III IV I II III IV I II III IV
2012 2013 2014 2015 2016
India
Inflation projection of the NBP based on the NECMOD model 15
-6
-5
-4
-3
-2
-1
0
1
2
3
4
-6
-5
-4
-3
-2
-1
0
1
2
3
4
08q1 09q1 10q1 11q1 12q1 13q1 14q1 15q1 16q1 17q117q4
% III 2015 VII 2015
GDP abroad (similar)
-8
-6
-4
-2
0
2
4
6
8
-8
-6
-4
-2
0
2
4
6
8
08q1 09q1 10q1 11q1 12q1 13q1 14q1 15q1 16q1 17q1 17q4
Euro area Germany
United States United Kingdom%
Inflation projection of the NBP based on the NECMOD model 16
0.0
0.5
1.0
1.5
2.0
2.5
3.0
3.5
4.0
4.5
5.0
0.0
0.5
1.0
1.5
2.0
2.5
3.0
3.5
4.0
4.5
5.0
08q1 09q1 10q1 11q1 12q1 13q1 14q1 15q1 16q1 17q117q4
% III 2015 VII 2015
Interest rates abroad (similar)
0
1
2
3
4
5
6
7
0
1
2
3
4
5
6
7
08q1 09q1 10q1 11q1 12q1 13q1 14q1 15q1 16q1 17q1 17q4
Euro area United States United Kingdom
Introduction
Changes between
rounds
Projection 2015 - 2017
Uncertainty
Outline:
Inflation projection of the NBP based on the NECMOD model 17
Aggregate demand
Consumption demand
Government demand
Investment demand
Foreign trade
Inflation projection of the NBP based on the NECMOD model 18
GDP and its components – 2014 Q4 and 2015 Q1
14q4 15q1
GDP (y/y) (%) 3.3 (3.2) 3.6 (3.2)
Domestic demand (y/y) (%) 5.0 (4.5) 2.6 (4.2)
Private consumption (y/y) (%) 3.0 (3.1) 3.1 (3.0)
Public consumption (y/y) (%) 6.0 (3.4) 3.3 (3.6)
Gross fixed capital formation (y/y) (%) 8.6 (9.6) 11.4 (6.8)
Exports (y/y) (%) 5.6 (3.8) 8.0 (3.2)
Imports (y/y) (%) 9.5 (6.7) 6.0 (5.5)
Net exports contribution (p.p.) -1.5 (-1.2) 1.1 (-1.0)
Values from the March projection are given in brackets (seasonally adjusted).
Indicators with values higher than in the March projection are marked green, whereas indicators with lower values are marked red.
Introduction
Changes between
rounds
Projection 2015 - 2017
Uncertainty
Outline:
Inflation projection of the NBP based on the NECMOD model 19
Consumption demand
Inflation projection of the NBP based on the NECMOD model 20
Labour market – 2014 Q4 and 2015 Q1
14q4 15q1
ULC (y/y) (%) 1.8 (2.1) 1.9 (1.3)
Labour productivity (y/y) (%) 1.4 (1.2) 1.9 (1.9)
Gross wages (y/y) (%) 3.1 (3.2) 4.1 (3.1)
Total employment LFS (y/y) (%) 1.9 (2.0) 1.7 (1.2)
Unemployment rate LFS (%) 8.3 (8.5) 8.0 (8.4)
Participation rate (%) 56.2 (56.4) 56.3 (56.4)
Values from the March projection are given in brackets (seasonally adjusted).
Indicators with values higher than in the March projection are marked green, whereas indicators with lower values are marked red.
Inflation projection of the NBP based on the NECMOD model 21
Number of job offers (in tous.) Flows to and from employment
High probability of finding a job, along with high number of vacancies
0
23
45
68
90
113
135
20
07
20
08
20
09
20
10
20
11
20
12
20
13
20
14
20
15
subsidized (sa)
unsubsidized (sa)
In May 2015 the number of job offers amounted to
the highest level since February 2008.
Steady increase in the number of unsubsidized
offers.
Further increase in the probability of finding a job.
Diminishing risk of job loss.
Source: MPiPS
Source: BAEL, NBP estimates
0.0%
0.5%
1.0%
1.5%
2.0%
2.5%
0%
2%
4%
6%
8%
10%
12%
14%
16%
18%
2006 2007 2008 2009 2010 2011 2012 2013 2014 2015
U->E (sa) LHS E->U (sa) RHS
Inflation projection of the NBP based on the NECMOD model 22
Share of enterprises planning wage increases Real wages in the enterprises sector
Pronunced upward trend in the number of vacancies relative to the number of
people looking for jobs, however low share of enterprises planning wage
increases
0.00
0.01
0.02
0.03
0.04
0.05
2007
2008
2009
2010
2011
2012
2013
2014
2015
-6%
-4%
-2%
0%
2%
4%
6%
8%
10%
Real wages y/y (sa) - LHS
Labour market tighteness index (sa) - RHS
Further increase in labour market tighteness index
measuring tensions on the labour market (the ratio of
vacancies to a number of people looking for a job).
Such high values observed for a last time in the first
half of 2008.
Decrease in the real wages in the enterprises sector
in two recent months.
The number of enterprises planning wage increases
remain stable, however wage increases apply to a
smaller share of employed persons.
0
5
10
15
20
25
30
35
40
45
50
2005
2006
2007
2008
2009
2010
2011
2012
2013
2014
2015
share of enterprises (s.a.) share of the employed (s.a.)
mean value
Inflation projection of the NBP based on the NECMOD model 23
-2
0
2
4
6
-2
0
2
4
6
08q1 09q1 10q1 11q1 12q1 13q1 14q1 15q1 16q1 17q117q4
y/y, % Employment
III 2015 VII 2015
Labour market
6
8
10
12
14
6
8
10
12
14
08q1 09q1 10q1 11q1 12q1 13q1 14q1 15q1 16q1 17q117q4
% Unemployment rate
III 2015 VII 2015
2
4
6
8
10
12
2
4
6
8
10
12
08q1 09q1 10q1 11q1 12q1 13q1 14q1 15q1 16q1 17q117q4
y/y, % Real wages
III 2015 VII 2015
53
54
55
56
57
53
54
55
56
57
08q1 09q1 10q1 11q1 12q1 13q1 14q1 15q1 16q1 17q117q4
% Participation rate
III 2015 VII 2015
Inflation projection of the NBP based on the NECMOD model 24
Wage pressure
Low wage pressure (NBP Quick Monitor.), ULC
In the first half of 2015 wage pressure remained low
and relatively stable.
Almost half of the population of enterprises report no
wage pressure.
-2
0
2
4
6
8
10
12
-2
0
2
4
6
8
10
12
08q1 09q1 10q1 11q1 12q1 13q1 14q1 15q1 16q1 17q1 17q4
y/y, % III 2015 VII 2015
Unit labour cost (ULC)
(higher)
0
10
20
30
40
50
60
70
2011 II
2011 III
2011 IV
2012 I
2012 II
2012 III
2012 IV
2013 I
2013 II
2013 III
2013 IV
2014 I
2014 II
2014 III
2014 IV
2015 I
2015 II
increased pressure no changes no pressure
Inflation projection of the NBP based on the NECMOD model 25
Labour market in the CEE peers
4
6
8
10
12
14
16
2007 2008 2009 2010 2011 2012 2013 2014 2015
Unemployment rate (sa, %)
CZ HU RO SK PL
-2
-1
0
1
2
3
4
2012 2013 2014 2015
Employment (y/y, %)
CZ HU PL SK
Inflation projection of the NBP based on the NECMOD model 26
Consumer sentiment
Consumer confidence indicators
Current purchases and intentions of purchases
Continuation of the upward trend of the most important
consumer confidence indicators, despite some slowdown
observed in May 2015.
-50
-40
-30
-20
-10
0
2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015
current (s.a.) leading (s.a.)
-50
-40
-30
-20
-10
0
10
2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015
Major purchases currently made (s.a.)
Major purchases in the next 12 months (s.a.)
Past and future financial situation of households
Source: NBP data
-35
-30
-25
-20
-15
-10
-5
0
5
2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015
Financial situation of households in recent 12 months (sa)
Financial situation of households in the next 12 months (sa)
Inflation projection of the NBP based on the NECMOD model 27
-1
0
1
2
3
4
5
6
7
-1
0
1
2
3
4
5
6
7
08q1 09q1 10q1 11q1 12q1 13q1 14q1 15q1 16q1 17q1 17q4
y/y, % III 2015 VII 2015
Consumption demand
Private consumption
(higher)
-1
0
1
2
3
4
5
6
7
-1
0
1
2
3
4
5
6
7
08q1 09q1 10q1 11q1 12q1 13q1 14q1 15q1 16q1 17q1 17q4
y/y, % III 2015 VII 2015
Real gross disposable income
(higher in the short term, lower in the long term)
Introduction
Changes between
rounds
Projection 2015 - 2017
Uncertainty
Outline:
Inflation projection of the NBP based on the NECMOD model 28
General government expenditure
Inflation projection of the NBP based on the NECMOD model 29
4
6
8
10
12
14
16
18
20
4
6
8
10
12
14
16
18
20
08q1 09q1 10q1 11q1 12q1 13q1 14q1 15q1 16q1 17q117q4
PLN bn III 2015 VII 2015
EU transfers absorption
0
10
20
30
40
50
60
70
80
0
10
20
30
40
50
60
70
80
2013 2014 2015 2016 2017
PLN bn
Human capital Agricul. Fund for Rural Dev.
Other expend., mainly enterprises Public sector current expenditure
Common Agricultural Policy Public sector capital investment
EU transfers
Inflation projection of the NBP based on the NECMOD model 30
Public consumption and investment
-10
-5
0
5
10
15
-10
-5
0
5
10
15
08q1 09q1 10q1 11q1 12q1 13q1 14q1 15q1 16q1 17q1 17q4
y/y, % III 2015 VII 2015
-40
-30
-20
-10
0
10
20
30
-40
-30
-20
-10
0
10
20
30
08q1 09q1 10q1 11q1 12q1 13q1 14q1 15q1 16q1 17q1 17q4
y/y, % III 2015 VII 2015
Public consumption Public investment*
*Reclassification of PKP PLK to the GG sector since 2014 led to changes in public investment dynamics in 2014, and taking into account
expected path of rail investment outlays, also in the projection horizon – particularly at the turn of 2016/2017.
Introduction
Changes between
rounds
Projection 2015 - 2017
Uncertainty
Outline:
Inflation projection of the NBP based on the NECMOD model 31
Investment demand
Inflation projection of the NBP based on the NECMOD model 32
Investment demand
Source: NBP Quick Monitoring Survey
Forecasts of demand, production and orders (sa, y/y, %) Capacity utilisation
-15
-10
-5
0
5
10
15
20
25
30
2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015
fixed component of demand (sa) demand (sa)
orders (sa) production (sa)
-8
-6
-4
-2
0
2
4
6
8
10
12
65
67
69
71
73
75
77
79
81
83
85
2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015
y/y (RHS) capacity utilization
capacity utilization s.a. long-term avg.
Inflation projection of the NBP based on the NECMOD model
Investment outlays of enterprises
33
Planned changes in investment outlays within a quarter and
in the current year, y/y (NBP Quick Monitor.)
New investment indicator (share of enterprises planning
to commence new investment within a quarter, NBP
Quick Monitoring Survey)
-15
-10
-5
0
5
10
15
2012 2013 2014 2015
annual plans
annual plans (major change balance)
quarterly plans
quarterly plans (major change balance)
-60
-40
-20
0
20
40
60
80
10
15
20
25
30
35
40
45
2005 2007 2009 2011 2013 2015
new investment indicator y/y (rhs) indicator s.a.
new investment indicator mean value
Inflation projection of the NBP based on the NECMOD model 34
-15
-10
-5
0
5
10
15
20
25
-15
-10
-5
0
5
10
15
20
25
08q1 09q1 10q1 11q1 12q1 13q1 14q1 15q1 16q1 17q1 17q4
y/y, % III 2015 VII 2015
Gross fixed capital formation (higher in the short horizon)
-2
0
2
4
6
8
10
12
-2
0
2
4
6
8
10
12
14q1 14q3 15q1 15q3 16q1 16q3 17q1 17q4
GFCF enterprises GFCF public sector GFCF housing
Introduction
Changes between
rounds
Projection 2015 - 2017
Uncertainty
Outline:
Inflation projection of the NBP based on the NECMOD model 35
Foreign trade
Inflation projection of the NBP based on the NECMOD model 36
High exports profitability
Exports profitability The value of euro exchange rate which make export
unprofitable
Source: NBP Quick Monitoring Survey
0
5
10
15
20
25
30
0
2
4
6
8
10
12
2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015
share of unprofitable exports in exports revenues (LHS)
share of exporters with unprofitable exports (RHS)
3.00
3.25
3.50
3.75
4.00
4.25
4.50
4.75
2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015
average
+/- 0.5 std.dev.
actual euro exchange rate
Inflation projection of the NBP based on the NECMOD model 37
However low exports dynamics
Indicator of export contracts and export forecast
Source: NBP Quick Monitoring Survey, EC
-20
-10
0
10
20
30
40
2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015
export contracts indicator (sa)
export forecast indicator (sa)
new export contracts indicator (sa)
2
5
8
11
14
2010 2011 2012 2013 2014 2015 2016
Autumn 2014 Winter 2015
Spring 2015
Global exports of goods and services, volume
(percentage change on preceding year) – European
Commission forecasts revisions
Inflation projection of the NBP based on the NECMOD model 38
Foreign trade Global exports dynamics
Source: CPB Netherlands Bureau for Economic Policy Analysis, Eurostat, International trade center, Duval et al. (2014)
Global imports dynamics
-3
0
3
6
9
12
15
2011 2012 2013 2014 2015
World
Advanced economies
Emerging economies
-3
0
3
6
9
12
15
2011 2012 2013 2014 2015
World
Advancedeconomies
Euro area trade dynamics
-10
-5
0
5
10
15
20
2011 2012 2013 2014 2015
intra exports
extra exports
total imports
Trends in global value chains
Inflation projection of the NBP based on the NECMOD model 39
4
4.2
4.4
4.6
4.8
5
5.2
5.4
4
4.2
4.4
4.6
4.8
5
5.2
5.4
08q1 09q1 10q1 11q1 12q1 13q1 14q1 15q1 16q1 17q1 17q4
III 2015 VII 2015
Foreign trade
Real effective exchange rate (REER) (stronger)
Inflation projection of the NBP based on the NECMOD model 40
-4
-3
-2
-1
0
1
2
3
4
5
-20
-15
-10
-5
0
5
10
15
20
25
08q1 09q1 10q1 11q1 12q1 13q1 14q1 15q1 16q1 17q1 17q4
Net exports contribution (p.p., RHS)
Exports (y/y) (%)
Imports (y/y) (%)
Net exports contributions
-3
-2
-1
0
1
2
3
4
-3
-2
-1
0
1
2
3
4
08q1 09q1 10q1 11q1 12q1 13q1 14q1 15q1 16q1 17q1 17q4
p.p. III 2015 VII 2015
Inflation projection of the NBP based on the NECMOD model 41
-3
-2
-1
0
1
2
3
4
5
6
-3
-2
-1
0
1
2
3
4
5
6
14q1 14q3 15q1 15q3 16q1 16q3 17q1 17q4
Consumption Gross fixed capital formation
Change in inventories Net exports
GDP
GDP (higher)
0
1
2
3
4
5
6
7
0
1
2
3
4
5
6
7
08q1 09q1 10q1 11q1 12q1 13q1 14q1 15q1 16q1 17q1 17q4
y/y, % III 2015 VII 2015
Inflation projection of the NBP based on the NECMOD model
Private consumption and investment outlays in the CEE peers
42
-6
-4
-2
0
2
4
6
8
2011 2012 2013 2014 2015
Private consumption (y/y, %)
CZ HU PL RO SK
-15
-10
-5
0
5
10
15
20
2011 2012 2013 2014 2015
Inwestment outlays (y/y, %)
CZ HU PL RO SK
Introduction
Changes between
rounds
Projection 2015 - 2017
Uncertainty
Outline:
Inflation projection of the NBP based on the NECMOD model 43
Inflation
Inflation projection of the NBP based on the NECMOD model 44
CPI inflation – I half of 2015
Values from the March projection are given in brackets (seasonally adjusted).
Indicators with values higher than in the March projection are marked green, whereas indicators with lower values are marked red.
15q1 15q2*
CPI inflation (y/y) (%) -1.5 (-1.2) -1.0 (-0.6)
Core inflation (y/y) (%) 0.4 (0.5) 0.3 (0.4)
Food prices inflation (y/y) (%) -3.7 (-3.0) -2.3 (-0.9)
Energy prices inflation (y/y) (%) -4.6 (-4.2) -3.6 (-3.5)
* Assuming that IE experts’ inflation forecast is correct.
Inflation projection of the NBP based on the NECMOD model 45
0.6
0.7
0.8
0.9
1.0
1.1
1.2
0.6
0.7
0.8
0.9
1.0
1.1
1.2
08q1 09q1 10q1 11q1 12q1 13q1 14q1 15q1 16q1 17q1 17q4
EUR, 2011=1 III 2015 VII 2015
Commodity prices
Index of energy commodity prices
(similar)
Index of agricultural commodity prices
(higher)
0.4
0.5
0.6
0.7
0.8
0.9
1.0
1.1
1.2
1.3
0.4
0.5
0.6
0.7
0.8
0.9
1.0
1.1
1.2
1.3
08q1 09q1 10q1 11q1 12q1 13q1 14q1 15q1 16q1 17q1 17q4
USD, 2011=1 III 2015 VII 2015
Inflation projection of the NBP based on the NECMOD model 46
Crude oil prices
The global supply, consumption and inventories of crude oil
OPEC crude oil supply (million b/d)
OECD crude oil inventories
Source: Department of Energy, US
-1
0
1
2
3
4
5
85
87
89
91
93
95
97
2011 2012 2013 2014 2015 2016
Change in inventories (RHS) Global supply (million b/d)
Global supply (million b/d)
2500
2600
2700
2800
2900
3000
3100
2011 2012 2013 2014 2015 2016
February, 2015 June, 2015
29
30
31
32
2012 2013 2014 2015 2016
February, 2015 June, 2015
Inflation projection of the NBP based on the NECMOD model
Inflation in the euro area 47
VA deflator and output gap in the euro area
-1%
0%
1%
2%
3%
4%
5%
6%
7%
8%
2001
2002
2003
2004
2005
2006
2007
2008
2009
2010
2011
2012
2013
2014
2015
Wage dynamics, ULC and core inflation (y/y)
ULC
Compensation per employee
Core inflation
-2
-1
0
1
EA DE ES FR IT
HICP inflation (y/y, p.p.) in major euro area countries
Dec-15 Jan-15 Feb-15 Mar-15 Apr-15
1.4
1.5
1.6
1.7
1.8
1.9
2.0
2.1
2.2
2.3
2.4
Jan 14 Apr 14 Jul 14 Oct 14 Jan 15 Apr 15
Inflation swap 5y/5y (p.p.)
-4%
-3%
-2%
-1%
0%
1%
2%
3%
4%
5%
0%
1%
1%
2%
2%
3%
3%
4%
2001
2002
2003
2004
2005
2006
2007
2008
2009
2010
2011
2012
2013
2014
2015p
2016p
2017p
GVA deflator - lhs Output gap - rhs
Inflation projection of the NBP based on the NECMOD model
Non-energy industrial goods inflation in Poland and in the
euro area
Inflation spillovers between Poland and the euro area (negative
values suggest that non-energy industrial goods inflation in the
euro area influence non-energy industrial goods inflation in
Poland)
48
Inflation of goods in Poland influenced by the inflation in the EA
-3
-2
-1
0
1
2
3
2008 2009 2010 2011 2012 2013 2014 2015
strefa euro Polska
-60
-50
-40
-30
-20
-10
0
2008 2009 2010 2011 2012 2013 2014 2015
-25
-15
-5
5
15
25
2008 2009 2010 2011 2012 2013 2014 2015-2
0
2
4
6
2008 2009 2010 2011 2012 2013 2014 2015
strefa euro Polska
HICP inflation in Poland and the euro area
Inflation spillovers between Poland and the euro area (negative values
suggest that HICP inflation in the euro area influence HICP inflation in
Poland)
EA Poland
EA Poland
Inflation projection of the NBP based on the NECMOD model
Deceleration of the downward trend of the producer price index
49
PPI
-6%
-4%
-2%
0%
2%
4%
6%
105
106
107
108
109
110
111
112
113
Ma
y 1
2
Jul 12
Se
p 1
2
Nov 1
2
Jan
13
Ma
r 1
3
Ma
y 1
3
Jul 13
Se
p 1
3
Nov 1
3
Jan
14
Ma
r 1
4
Ma
y 1
4
Jul 14
Se
p 1
4
Nov 1
4
Jan
15
Ma
r 1
5
Ma
y 1
5
Dynamics y/y (RHS)Index 2010=100S.A.Trend
• In recent months there has been a deceleration
of the downward trend of the producer price
index, which has been lasting since May 2012.
• The main reason for producer prices levelling off
is curbing the downward trend and an increase
in global crude oil prices in 2015.
• Year-on-year producer prices dynamics in May
rose by 0.5 p.p., to 2.2% y/y.
• The highest contribution to y-o-y growth of PPI
has manufacturing processing (-2.3 p.p.).
• In April year-on-year PPI domestic market
dynamics and PPI export market dynamics were
close to PPI composite growth.
Source: GUS, IE.
-5-3-113579
111315
Jan
12
Ap
r 12
Jul 12
Oct
12
Jan
13
Ap
r 13
Jul 13
Oct
13
Jan
14
Ap
r 14
Jul 14
Oct
14
Jan
15
Ap
r 15
PPI y/y composite
PPI y/y export market
PPI y/y domestic market
Inflation projection of the NBP based on the NECMOD model
Inflation expectations, 12 months horizon
50
-2
-1
0
1
2
3
4
5
6
7
8
-2
-1
0
1
2
3
4
5
6
7
8
Jan-0
4
Ma
y-0
4
Sep-0
4
Jan-0
5
Ma
y-0
5
Sep-0
5
Jan-0
6
Ma
y-0
6
Sep-0
6
Jan-0
7
Ma
y-0
7
Sep-0
7
Jan-0
8
Ma
y-0
8
Sep-0
8
Jan-0
9
Ma
y-0
9
Sep-0
9
Jan-1
0
Ma
y-1
0
Sep-1
0
Jan-1
1
Ma
y-1
1
Sep-1
1
Jan-1
2
Ma
y-1
2
Sep-1
2
Jan-1
3
Ma
y-1
3
Sep-1
3
Jan-1
4
Ma
y-1
4
Sep-1
4
Jan-1
5
Ma
y-1
5
The range of acceptable deviations from the inflation target
Current inflation Inflation target
Consumers - objectified measure Enterprises - objectified measure
Analists of the financial sector - median Consumers - main subjectified measure
Consumers - alternative subjectified measure
Inflation projection of the NBP based on the NECMOD model 51
-0.5
0.0
0.5
1.0
1.5
2.0
2.5
3.0
3.5
4.0
-0.5
0.0
0.5
1.0
1.5
2.0
2.5
3.0
3.5
4.0
14q1 14q3 15q1 15q3 16q1 16q3 17q1 17q4
Population Capital TFP
Labour market Potential output
Potential output
-3
-2
-1
0
1
2
3
4
5
6
-3
-2
-1
0
1
2
3
4
5
6
08q1 09q1 10q1 11q1 12q1 13q1 14q1 15q1 16q1 17q1 17q4
Output gap (% potential output)
GDP (y/y) (%)
Potential output (y/y) (%)
Inflation projection of the NBP based on the NECMOD model 52
Import prices and foreign exchange rate
-6
-4
-2
0
2
4
6
8
10
12
14
16
-6
-4
-2
0
2
4
6
8
10
12
14
16
08q1 09q1 10q1 11q1 12q1 13q1 14q1 15q1 16q1 17q1 17q4
y/y, % III 2015 VII 2015
Import prices
(higher in the short horizon)
4.0
4.2
4.4
4.6
4.8
5.0
5.2
5.4
4.0
4.2
4.4
4.6
4.8
5.0
5.2
5.4
08q1 09q1 10q1 11q1 12q1 13q1 14q1 15q1 16q1 17q1 17q4
III 2015 VII 2015
Real effective exchange rate (REER) (stronger)
Inflation projection of the NBP based on the NECMOD model 53
-6
-4
-2
0
2
4
6
8
10
12
-6
-4
-2
0
2
4
6
8
10
12
08q1 09q1 10q1 11q1 12q1 13q1 14q1 15q1 16q1 17q1 17q4
y/y, % Food prices inflation (%)
Energy prices inflation (%)
Domestic inflation
-2
-1
0
1
2
3
4
5
-2
-1
0
1
2
3
4
5
08q1 09q1 10q1 11q1 12q1 13q1 14q1 15q1 16q1 17q1 17q4
y/y, % CPI inflation (%) Core inflation (%)
Inflation projection of the NBP based on the NECMOD model 54
CPI inflation (y/y, %)
-2
-1
0
1
2
3
4
5
-2
-1
0
1
2
3
4
5
08q1 09q1 10q1 11q1 12q1 13q1 14q1 15q1 16q1 17q1 17q4
y/y (%) III 2015 VII 2015
-2.0
-1.5
-1.0
-0.5
0.0
0.5
1.0
1.5
2.0
-2.0
-1.5
-1.0
-0.5
0.0
0.5
1.0
1.5
2.0
14q1 14q3 15q1 15q3 16q1 16q3 17q1 17q4
Core inflation Food prices
Energy prices CPI inflationy/y (%)
Introduction
Changes between
rounds
Projection 2015 - 2017
Uncertainty
Outline:
Inflation projection of the NBP based on the NECMOD model 55
Uncertainty
Risk factors
Fan charts
Introduction
Changes between
rounds
Projection 2015 - 2017
Uncertainty
Outline:
Inflation projection of the NBP based on the NECMOD model 56
Risk factors
Inflation projection of the NBP based on the NECMOD model 57
■ Higher growth of domestic demand in Poland supported by stronger economic activity in the euro area (the effect of
the ECB’s quantitative easing, looser fiscal policy, and – in the longer term – implementation of structural reforms),
resulting in higher agricultural and energy commodities prices – optimistic scenario
■ Economic slowdown in Poland stemming from deterioration in the global economic conditions, especially in the
euro area (in case Greece declares insolvency) and in China. Followed by the increase in uncertainty on the global
financial markets, rise in the Polish Treasury bonds yields, exchange rate depreciation – pessimistic scenario
Scale of recovery abroad and in Poland
-3
-2
-1
0
1
2
3
4
5
-3
-2
-1
0
1
2
3
4
5
11q1 12q1 13q1 14q1 15q1 16q1 17q1 17q4
0
1
2
3
4
5
6
0
1
2
3
4
5
6
11q1 12q1 13q1 14q1 15q1 16q1 17q1 17q4
CPI inflation (y/y, %) GDP growth (y/y, %)
Inflation projection of the NBP based on the NECMOD model
Euro area – terms of public debt financing
58
Source: Eurostat, Stooq
0
5
10
15
20
25
30
35
40
2010 2011 2012 2013 2014 2015
10Y bond spread to Bund
GR IT ES PT FR
0
20
40
60
80
100
120
140
160
180
200
GR IT PT IE ES FR EA
Public debt in 2014 (% GDP)
Inflation projection of the NBP based on the NECMOD model
Greece
59
-16
-14
-12
-10
-8
-6
-4
-2
GR IE ES PT SI CY
Budget deficit in 2009 and 2014 (% GDP)
2009
2014
Source: Eurostat, Ameco
0.0
0.1
0.2
0.3
0.4
0.5
0.6
0.7
0.8
0.9
1.0
2008 2009 2010 2011 2012 2013 2014 2015
Composite Indicator of Systemic Risk
GR ES IE IT PT
Source: own calc. based on ECB data
Inflation projection of the NBP based on the NECMOD model
Pessimistic scenario – economic
conditions abroad
60
-8
-6
-4
-2
0
2
4
6
-8
-6
-4
-2
0
2
4
6
08q1 09q1 10q1 11q1 12q1 13q1 14q1 15q1 16q1 17q1 17q4
y/y, %
GDP growth abroad
pessim. VII 2015
0.0
0.5
1.0
1.5
2.0
2.5
0.0
0.5
1.0
1.5
2.0
2.5
08q1 09q1 10q1 11q1 12q1 13q1 14q1 15q1 16q1 17q117q4
y/y, % VA deflator abroad
pessim. VII 2015
3.2
3.4
3.6
3.8
4.0
4.2
4.4
4.6
3.2
3.4
3.6
3.8
4.0
4.2
4.4
4.6
08q1 09q1 10q1 11q1 12q1 13q1 14q1 15q1 16q1 17q117q4
EUR/PLN exchange rate
pessim. VII 2015
Inflation projection of the NBP based on the NECMOD model 61
Pessimistic scenario – GDP
0
1
2
3
4
5
6
7
8
0
1
2
3
4
5
6
7
8
08q1 09q1 10q1 11q1 12q1 13q1 14q1 15q1 16q1 17q1 17q4
y/y, % pessim. VII 2015
-3
-2
-1
0
1
2
3
4
5
6
-3
-2
-1
0
1
2
3
4
5
6
14q1 14q3 15q1 15q3 16q1 16q3 17q1 17q4
Spożycie ogółem Nakłady na środki trwałe
Przyrost zapasów Eksport netto
PKB
Change in inventories
Consumption
GDP
GFCF
Net exports
Inflation projection of the NBP based on the NECMOD model 62
Pessimistic scenario – inflation
-2
-1
0
1
2
3
4
5
-2
-1
0
1
2
3
4
5
08q1 09q1 10q1 11q1 12q1 13q1 14q1 15q1 16q1 17q1 17q4
y/y (%) pessim. VII 2015
-2.0
-1.5
-1.0
-0.5
0.0
0.5
1.0
1.5
2.0
-2.0
-1.5
-1.0
-0.5
0.0
0.5
1.0
1.5
2.0
14q1 14q3 15q1 15q3 16q1 16q3 17q1 17q4
Inflacja bazowa Ceny żywności
Ceny energii Inflacja CPI
Core inflation
Energy prices
Food prices
CPI inflation
Introduction
Changes between
rounds
Projection 2015 - 2017
Uncertainty
Outline:
Inflation projection of the NBP based on the NECMOD model 63
Fan charts
Inflation projection of the NBP based on the NECMOD model 64
-3
-2
-1
0
1
2
3
4
5
-3
-2
-1
0
1
2
3
4
5
12q1 12q3 13q1 13q3 14q1 14q3 15q1 15q3 16q1 16q3 17q1 17q4
90% 60% 30% central path inflation target
CPI inflation projection – July 2015
below
1.5%
below
2.5%
below
3.5%
below
central path
in the range
(1.5-3.5%)
15q2 1.00 1.00 1.00 0.50 0.00
15q3 1.00 1.00 1.00 0.49 0.00
15q4 0.88 0.98 1.00 0.48 0.12
16q1 0.54 0.80 0.94 0.47 0.40
16q2 0.47 0.72 0.89 0.47 0.42
16q3 0.43 0.67 0.86 0.48 0.43
16q4 0.46 0.69 0.87 0.49 0.41
17q1 0.50 0.72 0.88 0.51 0.39
17q2 0.51 0.73 0.89 0.52 0.37
17q3 0.50 0.72 0.88 0.53 0.38
17q4 0.48 0.70 0.86 0.52 0.39
Inflation projection of the NBP based on the NECMOD model 65
-1
0
1
2
3
4
5
6
7
8
-1
0
1
2
3
4
5
6
7
8
12q1 12q3 13q1 13q3 14q1 14q3 15q1 15q3 16q1 16q3 17q1 17q4
90% 60% 30% central path
GDP projection – July 2015