Can we forget about the interest rate cut for now? Glapiński’s bitter words
The Monetary Policy Council will start discussions on reducing interest rates in October next year, announced the president of the NBP, Adam Glapiński. This does not mean that such a reduction will occur next year.
On Thursday, the last conference this year of the President of the National Bank of Poland (NBP) and the Chairman of the Monetary Policy Council (RPP), Adam Glapiński, took place. It took place the day after the Council’s decision on interest rates. Let us recall that the body decided to leave rates at the current level for the 13th time in a row.
The head of the central bank pointed out that the current MPC forecasts regarding inflation were related to the government’s decision to further freeze energy prices. The scenario of further freezing would result in a decline in inflation towards the NBP target (2.5% with a deviation range of 1%). Then – as Glapiński said – the Monetary Policy Council would start a discussion on when to start cutting interest rates.
– But the situation has changed. An act has been adopted that neither freezes nor unfreezes energy prices, but only partially freezes them. For part of the year. We didn’t expect this. The partial freeze, until September, is difficult to interpret – said the president of the National Bank of Poland.
Interest rate cut only in 2026?
In his opinion, in a situation where electricity prices are frozen as decided by the government, there is no certainty that inflation will drop quickly. Glapiński pointed out that some MPC members claimed that the discussion on reducing interest rates could start in March next year. – Now this discussion will begin in October. But that doesn’t mean we will cut rates. This moves to 2026 – said the head of the National Bank of Poland.
Later in the conference, Glapiński argued that the debate on a possible rate cut would begin when the inflation level stabilizes.
– When the level of inflation stabilizes, the level of price increases. When it stabilizes and no longer grows, projections, forecasts and econometric models will show that the process of inflation decline begins. – said the president of the central bank.
In Glapiński’s opinion, the decision to partially freeze energy prices delays the achievement of the inflation target by about half a year. – This stays within 2026 but moves to the end of 2026 – said the head of the National Bank of Poland.
