The Monetary Policy Council is concluding its two-day meeting today, with investors overwhelmingly expecting no change in interest rates. The baseline scenario assumes that the National Bank of Poland will keep its reference rate at 3.75%, following the 25-basis-point cut delivered in March. Rather than rushing into another move, policymakers are now expected to assess new macroeconomic data and monitor the broader international backdrop.
One important factor shaping the current outlook is the temporary easing of tensions between the United States and Iran. News of a two-week truce has brought oil and gas prices down from their recent highs, reducing some of the immediate pressure on inflation expectations. Even so, the situation remains fragile, and the durability of the agreement is still far from certain. Markets are also paying attention to the unusual timing of today’s communication, as NBP Governor Adam Glapiński is due to hold a press conference at 3:00 p.m., which suggests the Council’s decision may be released earlier than usual.
Inflation accelerated to 3.0% in March, up from 2.1% in February, but the increase was driven mainly by higher fuel costs rather than a broad-based resurgence in price pressures. At the same time, the government has introduced temporary measures aimed at cushioning the impact of fuel prices, including a VAT reduction to 8%, lower excise duties, and a retail price cap mechanism. These steps could help contain inflation in the near term and strengthen the case for a more patient monetary policy stance.
Against this backdrop, many economists believe the Council may leave rates unchanged for longer, especially if inflation proves to be influenced more by temporary external shocks than by persistent domestic demand pressures. This also means that Governor Glapiński is likely to adopt a cautious tone, avoiding any strong suggestions about the next policy move.
Investor sentiment has improved in the meantime. On Thursday morning, the złoty remained firm, with the euro trading near PLN 4.2566 and the US dollar around PLN 3.6481. Equities also reflected stronger market confidence, with the WIG20 hovering around 3,526 points, close to levels last seen in 2007.
