The Polish economy is showing signs of slowing after posting a 2-percent year-on-year GDP increase in the fourth quarter of 2022, a government think-tank said on Tuesday.

Poland’s economy expanded by 3.6 percent year on year in the third quarter of 2022, and by 5.8-percent in the second quarter, according to the Central Statistical Office (GUS).

Experts from the Polish Economic Institute (PIE) believe that the slowdown is the result of recent interest rate rises and the weakening of the Eurozone economy.

“Poor sentiment is likely to be reported also this year as forecasts speak about a GDP growth at around 1 percent, which is much worse than in the previous years,” the PIE experts said.

According to PIE, investments were the main driving force of GDP growth in the fourth quarter as they went up by 4.9 percent year on year, while private consumption fell by 1.5 percent.

In their opinion, this year’s economic increase structure will be very similar as investment will likely continue to be the main growth factor.

“We expect investment to increase considerably this year as companies will increase their expenditure on energy effectiveness,” PIE experts wrote, adding that “public investments will also be on the rise.”