Analysts at Rabobank suggest that Poland’s main policy rate has been at an all-time low of 1.50% for more than three years now, and the Monetary Policy Council is set to extend this record-long period of stable rates when it announces its decision later today.
Key Quotes
“Despite robust economic activity, the majority of rate setters led by Governor Glapinski remain in favour of keeping rates unchanged. Their wait-and-see approach is based on the notion that the economy is well-balanced and that inflation is likely to stay within the 1.5-3.5% target band over the policy horizon. However, inflationary pressure may increase due strong private consumption.”
“The central bank’s reluctance to raise rates also leaves the zloty exposed to the unfavourable global backdrop. If that translates into a weaker currency, it would surely have inflationary consequences.”
“We are of the view that the MPC may have to seriously reconsider its intention to keep rates on hold for as long as possible in the coming months.”
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