The Polish Monetary Policy Council (MPC) will not cut interest rates over the next 12 months under current macroeconomic conditions, according to Goldman Sachs analysts. According to the bank, the January CPI inflation reading of 17.2% y/y and the Central Statistical Office’s revision of the inflation basket in mid-March will not significantly affect the monetary policy outlook.
NBP President Adam Glapinski noted at his recent press conference that the NBP does not have to end the cycle of rate hikes, but leaves open the possibility that inflation could fall enough to open the door to rate cuts later in the year. We have a more hawkish view of inflation dynamics in Poland and do not expect domestic economic conditions to leave much room for rate cuts in the next 12 months. We also believe that the NBP’s relatively more dovish stance will be a challenge, as the zloty will be noticeably weaker against the koruna and forint this year, according to Goldman Sachs’ commentary on January CPI inflation data.
The Central Statistical Office (GUS) reported today that consumer inflation was 17.2% y/y in January 2023. The GUS will publish on March 15 this year. – the so-called inflation basket for 2023, updating CPI data for January and February.
