MPC did not change interest rates. The current level is conducive to sustainable economic development – Polish Radio

Members of the Monetary Policy Council, from left: Eric Łon, Luke Hardt, Marek Chrzanowski, Jerzy Lodz President Jerzy Osiatyński, MPC chairman, NBP governor Marek Belka, Kamil Zubelewicz, Jerzy Żyżyński, Eugene Gatnar Grazyna Ancyparowicz Photo: PAP / Paweł Supernak

Currently, the basic rate of the Polish National Bank 1.5 percent.

MPC maintains its assessment that the current level of interest rates is conducive to the economy

the Monetary Policy Council maintains its assessment that in the light of the available data and forecasts current rates rates conducive to maintaining the Polish economy on the path of sustainable growth and to preserve macroeconomic stability – said in a statement after a two-day MPC meeting.

we will still have to deal with deflation

“in the opinion of the Council in the coming quarters, CPI growth will remain negative due to the earlier strong fall in commodity prices on world markets.

Proceed will be economic growth, with greater consumer demand, increasing employment

at the same time this will be accompanied stable economic growth, including the expected increase in consumption demand growth supported by rising employment, the projected acceleration in wages and an increase in social benefits.

the risk associated with the economic situation in the world and fluctuations in commodity prices

at the same time a source of uncertainty for the economy – including price formation – remain downside risks to the world and fluctuations in commodity prices, “- said in Wednesday’s statement.

MPC also stated that “Poland has a stable economic growth, although data on industrial output and construction and assembly indicate that GDP growth in the first quarter. could be slightly lower than in the previous quarter. “

beam to cut interest rates

” The increase in activity is still supported by steady growth in consumption and rising investment. Increasing consumer demand is conducive to progressive employment growth and improving consumer sentiment. In addition, investments are backed by good financial companies, high use of their production capacity and the relatively favorable demand prospects. Accompanied by stable growth in lending. The pace of economic growth is also constrained by the weakening of external demand, “- states at the same time the Council.

The NBP governor Marek Belka said at a press conference that the current situation of the economy” are not conditions in which one thinks to cut rates ” .

“I do not think that the events of the last month made a rate cut more likely,” – he said, adding that he meant including “dynamic economic growth in Poland” and a decisive improvement in the labor market.

“I think the downward movement in interest rates would have a direct impact on the formation of the cost of servicing the public debt” – said the president of the NBP.

“that’s why we do not want to lower the foot, because I think, that in this respect we reached a certain level of balance “- rated. He pointed out that the interest rates of loans for small businesses are on the same level as in the euro area.

” When will the rapid deterioration in economic activity, then you will be able to think about the significant reduction of interest “- said Belka. “Then perhaps it is worthwhile to cut rates significantly” – he added.

The two-day meeting of the Council was the first in a new, full court. Upcoming changes in the body that await us in the middle of the year. Then ends the term of office of the President of the Polish National Bank Marek Belka, who is also chairman of the Council.

The last time the MPC cut interest rates in March 2015 by cutting then all of 50 basis points.

Prof. Elizabeth Mączyńska: MPC will be a tough nut to crack.

Source: Newseria

The Council Decision is consistent with the predictions of most experts.

“the MPC is guided by the state of the economy, not the inflation target”

According to the chief economist of Credit Agricole, Jakub Borowski, the Council is more important situation in the economy than inflation target. As long as the economy does not come signs of its slowing down, according to the expert, the board will satisfy the situation. Economist advises that the MPC does not pursue the inflation target and agrees with the fact that it will not be achieved for a long time.

According to the expert, the MPC will raise interest rates early in the second half of next year. Jakub Borowski predicts that the emergence of inflation may prompt the Monetary Policy Council members to a gradual tightening of monetary policy.

According to the MPC inflation, ie general price increase per year should be 2.5 percent, with deviation of one percentage point in both directions.

IAR / PAP, Celebrating