While many analysts expect interest rate cuts in September, the matter is not yet settled. – If the decision were to be taken today, I would certainly not encourage easing the conditions of monetary policy – said Przemysław Litwiniuk, a member of the Monetary Policy Council, on the air of the Newsroom WP program.
At its last meeting, the Monetary Policy Council officially ended the cycle of interest rate hikes. Due to the falling inflation, there is talk of a possible reduction, even in September. However, the MPC member, Przemysław Litwiniuk, said on Monday that if the meeting were held today, he would not vote for a cut.
Too early to cut interest rates
“We need to carefully analyze the phenomena that will take place in the autumn, because there are risks of the election cycle, the risk of a revival of consumption, which may grow. Risks related to commodity prices – we see what is happening with oil – expectations that its price will stabilize at the pre-pandemic level. All this leads to reflection that it is too early to open champagne. Let’s look at Spain – a rapid decline was also expected, and recently, unfortunately, an increase in inflation has been recorded. This is a persistent and recurring phenomenon, “said Litwiniuk in interview in the “Newsroom” program on WP.pl.
He added that his view of maintaining the current parameters in monetary policy would not be “definitive” in the Council.
“It seems that my view will not be decisive. The second argument not to say how I will vote on September 6 is that it is August 8, and a lot can change in a month, but if the decision were to be made today, then I certainly would not encourage easing the conditions of monetary policy,” summed up the MPC member.
Inflation is falling
Last week, the Central Statistical Office released a preliminary estimate of CPI inflation for July. It amounted to 10.8 percent. This so-called quick respect. Details of the data – how exactly the prices of individual food goods, other products (fuel, energy, clothing, etc.) or services have changed – will be known on August 14.
10.8 percent reading is the lowest since February 2022, when annual inflation amounted to 8.5 percent. Inflation in Poland has been falling for the fifth month in a row – it peaked in February this year, when it reached 18.4 percent. Every year. Since April 2021, the consumer price index has been above the upper limit for deviations from the inflation target set by the Monetary Policy Council at 2.5%.