Polish Central Bank Governor Suggests Rate Cuts Could Happen Before 2026

• Polish Central Bank Governor Adam Glapiński has hinted that monetary policy easing might occur before 2026, revising his earlier statements.
• Glapiński indicated that a discussion on rate cuts could be justified if it’s confirmed that inflation has peaked and is steadily declining toward the target.
• The National Bank of Poland has maintained its main interest rate at 5.75% since October 2023.
• Year-on-year inflation in Poland rose to 4.2% in July, up from 2.6% in June, driven by the partial relaxation of regulated energy prices.

Warsaw, August 20 (FFN) – Polish Central Bank Governor Adam Glapiński has revised his stance on when the central bank might start cutting interest rates, suggesting that it could happen before 2026. This marks a shift from his previous comments, where he indicated that the room for reducing interest rates wouldn’t emerge until 2026 due to expected inflation pressures.

Glapiński’s comments reflect a more flexible approach, acknowledging that if inflation reaches its peak and begins to decline sustainably, there could be grounds to consider easing monetary policy earlier than previously anticipated.

The National Bank of Poland has held its main interest rate steady at 5.75% since October 2023, amid efforts to control inflation. However, inflation in Poland accelerated to 4.2% in July from 2.6% in June, largely due to the partial relaxation of regulated energy prices at the beginning of the month, a development that Glapiński said was anticipated.

Glapiński defended the decision to keep rates unchanged, stating that it successfully brought inflation down from high levels without excessive costs to the economy. He reiterated that future monetary policy decisions would be based on the latest information regarding inflation forecasts and economic activity.

Overview of Interest Rates and Inflation in Poland