Poland Monetary Policy


Central Bank cuts rates again in December

At its 4-5 December monetary policy meeting, the National Bank of Poland (NBP) lowered its reference rate by 25 basis points to 4.25%, in a move that was widely expected by the market. The Central Bank confirmed that global economic activity remains weak amid the ongoing recession in the Euro area as well as relatively slow economic growth in the largest emerging economies. On the domestic side, the Bank reiterated that growth continues to decelerate, which has been confirmed by the recent Q3 GDP data.

Regarding price developments, the Central Bank stated that due to moderating GDP growth and limited price pressures there is a risk of inflation declining below the NBP's inflation target in the medium term. Inflation fell to 3.4% in October, the lowest level seen in almost two years, and is now within the Central Bank's target of 2.5% with a tolerance margin of plus/minus 1.0 percentage points.

Consequently, the Bank maintained its dovish stance and stressed its readiness to further ease monetary policy if economic data in the coming months continue to show signs of a slowdown and inflationary pressures remain contained.


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Poland Monetary Policy Chart

Poland Monetary Policy December 2012

Note: NBP Reference Rate in %.
Source: National Bank of Poland (NBP).

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