In August, the Monetary Policy Council took a summer break and there were no interest rate increases at that time. In September, however, the people deciding about Polish monetary policy will gather again.
When asked if there was still room for interest rate increases in Poland, MPC member Przemysław Litwiniuk said on radio Tok FM that in his opinion “unfortunately yes”.
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“I don’t see it as big, at least from today’s data point of view. […] On September 7, when we have more data on the table, we will consider this kind of step“- said the MPC member.
“On the other hand, as long as core inflation grows, as long as it is persistent and spilled in the Polish economy and as long as the government announces – although we do not see the draft yet, we will see the draft state budget for the next year in September – but as long as the government announces an active fiscal policy, and investment expenditures are not as much as one might expect – so far this space exists, “he added.
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According to him “the peak of inflation may still last, but it will not increase“.
The second factor is the parameters of the fiscal policy.
“If we are still inundated with unmarked cash flows, we will have to tighten monetary policymaybe slightly, maybe in a few steps and see what the consequences will be “- summed up Litwiniuk.
The MPC started to raise interest rates in October 2021 and made them monthly. After the 50 bp hike in July, the main reference rate is 6.5%.