C/A deficit for February declined to USD 789m and the trade deficit narrowed to mere USD 776 m in February. The narrowing was enabled primarily by falling imports, which posted the lowest monthly value since 1997. The data show weak domestic demand. Although the industrial output improved in February, due to the delay of the central bank payment statistics, however, we can hope for the reflection of this recovery to appear in March data.
The C/A deficit was wider than the trade gap due to weak service (USD –136m) and incomes (USD –88m), and also due to the quite low surplus of unregistered transactions (USD +88m). After the zloty weakened vs. the dollar in from January to February, the households probably stopped converting their foreign cash in zlotys.
Jakub Dvorak, CSOB