Poland holds rate at 1½% amid continued global economic recovery

By Tali Rackner

Minneapolis, Jan. 10 – The National Bank of Poland’s monetary policy council decided to keep its interest rates at their current levels during a meeting held Tuesday and Wednesday.

The reference rate was maintained at 1½%, the lombard rate at 2½%, the deposit rate at ½% and the rediscount rate at 1¾%.

“Despite ongoing global recovery, inflation abroad remains moderate, on the back of persistently low domestic inflationary pressure in many countries,” the bank said in a statement.

“At the same time, prices of certain commodities, including oil, have risen in recent months.”

The European Central Bank keeps interest rates close to zero, including the deposit rate below zero, and continues to purchase financial assets, while the U.S. Federal Reserve started increasing its interest rates in December and keeps shrinking its balance sheet, the bank noted.

Favorable economic conditions in the Polish economy will continue through the next quarters, the council said, yet GDP growth is expected to be lower than in the second half of 2017. Based on this, the bank expects inflation to remain close to the inflation target over the projection horizon.

The bank kept interest rates unchanged at its meeting held in December.

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