WARSAW (Reuters) – Polish central bank Governor Adam Glapinski said on Thursday there were no reasons for cutting interest rates at the moment due to the outlook for inflation and he did not think that the current level of rates was a barrier to economic growth.
Poland’s central bank, or NBP, left its main interest rate unchanged at 5.75% as expected on Wednesday.
“The current strong increase in inflation, with still high wage dynamics, although decreasing, with increased core inflation and ongoing economic recovery and loose fiscal policy do not provide any grounds for lowering interest rates at the moment,” he told reporters.
“The current level of NBP interest rates is not a significant barrier to the development of the economy and investments.”
The central bank also trimmed its inflation forecast for 2025 on Wednesday but raised its prediction for 2026 in its March projections, raising the risk that price growth could remain above the bank’s target range throughout next year.
Glapinski said on Thursday that inflation would return to the central bank’s target of 2.5% only in 2027 after ending 2025 at around 5% year on year, with core CPI at 4% throughout the year.
Even though Glapinski sees no scope for rates cuts now, he said the central bank did start discussing when they could come.
“The majority of the Council asked to say that almost all Council representatives – not all, but many – were analysing the possibility of a rate cut and when it could take place,” he said.
(Reporting by Karol Badohal, Alan Charlish, Pawel Florkiewicz; Writing by Anna Wlodarczak-Semczuk; Editing by Alison Williams)
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