NBP: wages will fall, deposits will remain unprofitable

The National Bank of Poland (NBP) has some bad news for us. The "Inflation Report" relayed that this year Poland's GDP decline [...] https://www.pinterest.com/pin/1085437947660215829/

The National Bank of Poland (NBP) has bad news for us. In the "Inflation Report" it was conveyed that this year Poland's GDP will fall by 5.4 percent, followed by economic growth of 4.9 percent in 2021 and 3.7 percent in 2022. However, quite high unemployment and falling wages await us. In addition, savers should not keep their money on deposits. NBP and the crisis Admittedly, our central bank believes that with the lifting of individual restrictions related to the pandemic, the global economy will recover, but this does not mean a V-shaped rebound. The above will supposedly be prevented by slower income growth than before the crisis, "changes in population behavior, and the increased importance of the precautionary motive in decisions to choose between consumption and saving." "Households and businesses will also refrain from undertaking long-term investment projects, supported only by a slight improvement in their financial situation relative to the pre-crisis period and persistently elevated uncertainty." - reads the Inflation Report. Unemployment jump The NBP also predicts that the unemployment rate will be as high as 5 percent at the end of this year, but will then rise to 5.6 percent at the end of 2021, and fall to 5.2 percent at the end of 2022. Wages will also fall, and while that ratio will later rebound, its growth will no longer be as high as it was before. "The repeal of further restrictions, the gradual recovery of economic activity and the increase in labour productivity will cause wages to start rising again from the second half of this year, although their year-on-year growth rate will remain close to zero until early 2021. In subsequent years, this trend will continue, but the average wage growth rate will not reach the level of 2018-2019 due to the elevated level of the unemployment rate." - NBP forecasts. Deposits not for conscious savers The NBP also has some sort of dire news for people who want to save safely. According to bank Pekao analysts, "the NBP's pessimistic projection effectively rules out interest rate normalization in the coming 2-3 years. Today, many banks offer deposits at a level of, for example, 0.01 percent. This will probably not change soon. People with a lot of capital will therefore start to look for alternative investments... Tags deposits NBP saving