Polish retail sales increased more than analysts expected in February, suggesting consumption will be the main driver of growth in Poland's economy this year.

Retail sales, at constant prices, grew by 6.1% year-on-year in February. Analysts polled by Reuters had expected a year-on-year rise of 4.9%.

Consumer spending has been a key driver of Poland's economy but previously suffered due to rampant price rises. Inflation, however, slowed to 2.8% in February from a peak of 18.4% a year earlier.

Analysts say consumers are now more optimistic about their financial situation and have started to loosen the purse strings.

"This is not a consumption boom, but we have confirmation that consumption will be the main (who knows, maybe not the only) engine of GDP growth this year," Bank Pekao analysts said in a note.

Moreover, according to ING analysts, high wage growth is also starting to translate into consumption, the pace of which is the highest since 1999. In February, wage growth was 12.9% year-on-year. (Reporting by Pawel Florkiewicz; editing by Christina Fincher)