Polish interest rates remain unchanged

The benchmark rate will remain at a record low of 1.5 percent, following a cut in March. The Council’s decision is in line with market expectations.

Following its March decision to cut rates by 50 basis points, the RPP said that the decision is “closing the cycle of monetary policy easing.”

“In Poland, 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,” the RPP wrote in a statement on Tuesday.

“Recently released economic activity indicators were lower than expected, but their decline will probably prove temporary. As demand is growing at a moderate pace and the output gap is still negative, there is no inflationary pressure in the economy. Both annual consumer price growth and producer price growth remain negative and declined slightly last month. Deflation has deepened mainly due to falling commodity prices in global markets. Amidst moderate wage growth, this contains the risk of increasing cost pressure. Inflation expectations are still very low.” (rg/rk)