The International Monetary Fund (IMF) has revised its inflation projections for Poland, predicting a slightly higher short-term slowdown than previously estimated. As per the updated estimates released on Wednesday, October 11, Poland is expected to hit the National Bank of Poland's (NBP) inflation target by the end of 2026. The consumer price inflation is anticipated to decrease from the September rate of 8.2%, as reported by the Central Statistical Office (GUS), to 7.4% year-on-year by the end of 2023. The IMF also forecasts a CPI rate of 5.5% by the close of 2024, and 4% by late 2025, aiming ultimately for the NBP's target of 3.3%.
In a report titled "Light on the Horizon?" released on the same day, the IMF predicted a short-term deceleration in Africa's economy due to harsh headwinds but anticipates recovery by 2024. The GDP growth of sub-Saharan Africa is expected to decrease from 4% in 2022 to 3.3%, before bouncing back to 4%. This predicted rebound is attributed to falling inflation, stabilizing public finances, and potential growth.
However, significant challenges persist in the region due to factors such as the pandemic, surging food prices following Russia's invasion of Ukraine, aggressive global interest-rate hikes leading to a financial squeeze amidst rising debt-service costs, and weakening currencies. South Africa and Nigeria are forecasted to play instrumental roles in the recovery process despite their respective challenges.
On Thursday, October 12, Gita Gopinath, IMF's first deputy managing director, expressed concern over the economic impact of the Israel-Hamas conflict in an interview. She warned that a 10% oil price hike due to an extended conflict could boost global inflation by 0.4 percentage points and reduce output by 0.15 percentage points within a year. Gopinath also mentioned China's property sector crisis and the recent interest rate cut, the need for an efficient restructuring process for low-income countries' debts, the surge in trade restrictions last year, and the 'very unfavorable' US Treasury debt dynamics.
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