Position of RPP Member

• RPP member Marcin Zarzecki assesses the November interest rate hike as unlikely, but does not rule it out.
• Before the summer, the market expected interest rate cuts, but now tightening monetary policy has returned to the discussion.
• The RPP is under pressure from the weakening zloty, persistent core inflation, and the potential rise in energy prices.
• Two events in the Polish economy, the details of which have not been disclosed, would need to occur for a hike in November.

Marcin Zarzecki from the Monetary Policy Council told Bloomberg that he does not expect an interest rate hike in November, but he does not dismiss such a scenario (Interest rate hike possible this year. Voice from RPP – com.pl). He assesses the probability of tightening monetary policy at the next meeting as low (RPP under pressure from a weak zloty. Marcin Zarzecki does not rule out an interest rate hike - Puls Biznesu - pb.pl – pb.pl). The President of the National Bank of Poland, Adam Glapiński, expresses similar views.

Change in Sentiments Around Interest Rates

Before the summer, expectations for interest rate cuts dominated public debate, and a hike was not considered a real option. In recent months, the discussion has reversed, and tightening monetary policy has returned as a more seriously considered scenario.

What Could Prompt RPP to Act

Three factors currently influence the Monetary Policy Council: the weakening zloty, persistent core inflation, and the prospect of rising energy prices. These could determine the decision to raise interest rates.

Conditions for the November Decision

For a hike to take place in November, two events would need to occur in the Polish economy, the details of which have not been provided. The next meeting of the Monetary Policy Council will show whether the concerns of RPP members will translate into concrete decisions.