Money in Poland
Poland - Money
Central Bank slashes rates to fresh all-time low in April; reinforces quantitative easing
On 8 April, the National Bank of Poland (NBP) slashed the reference rate from 1.00% to a new record low of 0.50%, in a bid to cushion the economic impact of coronavirus. In addition, the Central Bank cut the Lombard rate to 1.00%, the rediscount rate to 0.55%, and the deposit rate to 0.00%. At the same time, the Bank reinforced its commitment to support financial markets and contribute to the normal functioning of the banking system through a set of strong measures aimed at ensuring liquidity.
The Bank’s decision was prompted by the economic damage caused by coronavirus, compounded by expected associated downside pressures on prices. In an effort to keep lending channels open and support commercial banks, the Bank will continue to provide liquidity to the banking sector by extending repo operations and refinancing new loans granted to companies and households. Moreover, the NBP strengthened its quantitative easing program, announcing it will keep purchasing government bonds in the secondary market while broadening the list of eligible instruments to other state-guaranteed bonds, thus providing further liquidity to the government bond market.
The spread of Covid-19 and the associated containment measure are taking a heavy toll on economic activity and sentiment, and the short-term drop in activity is expected to be sizable. Looking further ahead, significant uncertainty stems from the duration of the coronavirus outbreak and the associated containment measures, although solid macroeconomic fundamentals should help the economic recovery once the emergency is over. In terms of price pressures, faltering domestic demand and lower oil prices should more than offset the NBP’s expansionary monetary stance and thus contribute to a marked decrease in inflation in the short- to medium-term.
The next monetary policy meeting is scheduled for 5–6 May.
FocusEconomics analysts are still taking into consideration the latest economic developments.
Poland - Money Data
|Money (annual variation in %)||8.8||9.6||9.7||4.5||8.8|
5 years of economic forecasts for more than 30 economic indicators.
Poland Money Chart
Source: National Bank of Poland.
|Bond Yield||2.07||-0.30 %||Dec 31|
|Exchange Rate||3.79||-0.53 %||Jan 01|
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May 25, 2020
Retail sales nosedived 22.6% year-on-year in April amid lockdown (March: -7.0% yoy), marking the steepest fall on record.
May 21, 2020
Industrial output crashed an all-time sharp 24.6% year-on-year in April, following the milder 2.3% drop recorded in March, according to the Central Statistical Office (GUS).
May 15, 2020
The economy grew 1.9% year-on-year (yoy) in the first quarter of this year, marking the weakest expansion since Q3 2013, according to a preliminary estimate released by the Statistical Institute (GUS) on 15 May.
May 15, 2020
Consumer prices dipped 0.1% over the previous month in April, contrasting March’s 0.2% increase.
May 6, 2020
Consumer prices remained unchanged over the previous month in April, following March’s 0.2% uptick, according to provisional data released by the Poland’s Statistical Institute (GUS).