Today the MPC decision on interest rates. Will new inflation data cause a breakthrough?

Interest rates in Poland.  There is a decision of the Monetary Policy Council

In the afternoon we will know the Monetary Policy Council's decision on interest rates. Will the latest inflation data translate into cuts? Experts have no doubts on this matter.

The two-day meeting of the Monetary Policy Council (MPC) will end today. Until recently, it seemed almost certain that the body would once again decide to leave interest rates at the current level. Will the latest inflation data in Poland cause a breakthrough?

Let us recall that at the end of last week the Central Statistical Office (GUS) reported that inflation in March this year. was 1.9 percent Every year. This is the lowest level in five years. Preliminary data also means that inflation remains within the inflation target of the National Bank of Poland (NBP), which is 2.5%. +/- 1 percentage point.

What is the Monetary Policy Council's decision regarding interest rates? Expert forecasts

According to Bank Pekao economists, inflation is only “temporarily” within target, and the Monetary Policy Council will not change its base scenario taking into account the uncertainty regarding regulated energy prices (to which the Monetary Policy Council pays great attention) and the expected rebound in inflation in the second half of this year (analysts forecast that it will increase to 4-4.5% at the end of the year). The bank's experts predict that interest rates will remain unchanged this year.

– We expect the Monetary Policy Council to leave interest rates unchanged in April, continuing to highlight upside risks to the inflation path in the coming months – forecast economists from ING Bank Śląski, quoted by

Experts point out that although the main inflation rate fell below the NBP target, according to their estimates, core inflation (excluding food and energy prices) was still nearly twice as high as the inflation target in March (approx. 4.6% year-on-year). .

Also, according to Santander Bank Polska economists, the path of core inflation will be more important for the Monetary Policy Council, which may remain in the range of 4-5 percent until the end of next year. – This, given the economic recovery, will, in our opinion, give the Monetary Policy Council an argument to keep rates unchanged until Q3 2025 – institutional analysts predict.

Let us recall that the last time the Monetary Policy Council reduced interest rates was in October last year. Since then, rates have remained unchanged. The main reference rate is 5.75%.

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