In line with our expectations, the Monetary Policy Council (RPP) left interest rates unchanged on Wednesday, following a cumulative reduction of 175 basis points in 2025. During today’s press conference, the President of the National Bank of Poland (NBP) confirmed that policymakers are satisfied with the development of the inflation situation and that the outlook remains encouraging.
Glapiński maintained an optimistic tone and signaled that there is room for further monetary policy easing; however, he remained ambiguous regarding the timing of the next rate cut, suggesting it could occur in February or March. He also reiterated his view that the reference rate could ultimately be lowered to 3.5%. However, he added that some RPP members believe it should be lower. Given the lack of surprises, neither the interest rate decision nor the NBP President’s comments today triggered significant market volatility, and the EUR/PLN exchange rate has remained relatively stable in recent days.
In light of easing price pressures, we have no doubt that another cut will occur soon, and we see strong arguments for a reduction in either February or March. The calendar slightly favors a March cut. The February decision is just three weeks away, and Statistics Poland (GUS) will not publish fresh inflation data before then, whereas in March, the NBP will release its new inflation and growth projections. At the same time, the latest inflation data is encouraging, and if other incoming readings are favorable, it may be enough to convince policymakers that a longer pause is unnecessary.
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