POLAND: Headline CPI Inflation Undershoots NBP's +2.5% Y/Y Target

[CORRECTS RATINGS] "Luxembourg – “Today, EFSF, the European Financial Stability Facility, rated Aaa (Moody’s) / A+ (Fitch) / A+ (S&P), has sent a Request for Proposal to a selection of banks from the EFSF/ESM Market Group with regards to an upcoming transaction, subject to market conditions.”

Source: Market contact

“Today, EFSF, the European Financial Stability Facility, rated Aaa (Moody’s) / AA- (Fitch) / AA (S&P), has sent a Request for Proposal to a selection of banks from the EFSF/ESM Market Group with regards to an upcoming transaction, subject to market conditions.”

Source: Market contact

Spanish Q3 Flash GDP printed inline with expectations on the sequential measure, at 0.6% Q/Q (0.8% Q2). On a Y/Y basis, GDP was marginally weaker than expected, at 2.8% (3.0% Q2, revised from 3.1%), the lowest since Q4 2023. While the yearly rate is tapering off a little vs the particularly strong prints since the beginning of 2024, today's print suggests another solid quarter of growth in Spain.

• "Domestic demand contributed 1.2 percentage points to Q/Q GDP growth. Meanwhile, external demand contributed -0.6 percentage points", INE comments.
• Private consumption rose 1.2% Q/Q (0.7% Q2), gross fixed capital formation saw a very strong 1.7% Q/Q print (with gains in both building and machinery, 0.9% Q2), and government consumption rose 1.1% Q/Q (0.0% Q2). Exports were weak at -0.6% Q/Q (first decline since Q3 2023, 1.3% Q2), while imports rose 1.1% (1.6% Q2).
• "Hours worked varied by 2.5% Y/Y and employment in terms of full-time equivalent workers by 3.3%, compared to 1.6% and 3.4% in Q2" implying mixed productivity developments.
• "The GDP deflator increased by 2.8% year-on-year, three-tenths of a percentage point higher than in the previous quarter.
  On a quarter-on-quarter basis, it rose by 0.7%."