Poland Monetary Policy


NBP keeps reference rate again at record low of 1.50%

The National Bank of Poland (NBP) decided to keep its reference rate at the record low of 1.50% at its 5–6 October monetary policy meeting. The decision matched market expectations and marked the fifth consecutive time the NBP has left the rate unchanged.

In its accompanying statement, the NBP reaffirmed that the global economy is growing moderately. According to the Bank, the Euro area is continuing to recover steadily. Meanwhile, the U.S. economy has been picking up in the last months. In contrast, China’s recent economic data indicate further deterioration and Russia and Brazil are still in recession. Consequently, concerns over weaknesses in developing countries and thus uncertainty regarding global demand remain significant. In addition, uncertainty related to the future monetary policy of major central banks, especially the Federal Reserve, has been causing important volatility in financial markets.

On the domestic front, the Bank commented that, “stable economic growth continues, driven mainly by rising domestic demand, which is supported by favourable labour market developments, consumer confidence and financial standing of enterprises, as well as by stable lending growth. Recently released economic activity indicators were lower than expected, but their decline will probably prove temporary.”

Regarding inflation, the Bank stated that inflationary pressures are muted in the economy due to moderate growth in demand and a continuing negative output gap. Low commodity prices and moderate nominal wage growth are contributing to the lack of cost pressure. The pace of the price decrease has recently deepened due to these factors, and inflation expectations remain subdued.

Finally, the Bank commented that, “price growth will increase slowly in the coming quarters, supported by the expected closing of the output gap amid improving economic conditions in the euro area and favourable domestic labour market developments. At the same time, persisting risk of stronger economic slowdown in the emerging market economies, low commodity prices and weaker inflation outlook abroad result in increased uncertainty about the pace of inflation returning to the target.”

FocusEconomics Consensus Forecast panelists expect the policy rate to end 2015 at 1.51%. For 2016, the panel sees the rate ending the year at 1.99%.

Author:, Economist

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Poland Monetary Policy Chart

Poland Monetary Policy October 2015

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

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