At its February meeting, the Monetary Policy Council (RPP) decided to keep interest rates unchanged. The decision was not clear-cut from the market’s perspective, as expectations were split almost equally between a rate cut and maintaining them at their current levels.
It is worth noting that the RPP reached its decision with a limited influx of new macroeconomic data. The consumer inflation reading for January will not be released until February 13, while February data will be published on March 13. Furthermore, the March release will include a new inflation basket and revisions of previous readings for January and February, which further increases interpretative uncertainty.
Following six interest rate cuts in 2025, totaling 175 basis points, the National Bank of Poland’s (NBP) main reference rate currently stands at 4.00%.
Consumer inflation remains within the NBP’s target, and all indications suggest it will stay there in the medium term. A key confirmation of this assessment will be the NBP’s March inflation projection.
According to current market expectations, the target interest rate level is hovering around 3.50%, which could be reached in the first half of 2026. There are also isolated voices among economists suggesting the possibility of further cuts toward 3.00%, though this remains a less likely scenario at this stage.
