Bloomberg News

Poland’s Central Bank Sees No Rate Change in Coming Quarters

October 20, 2011

(Updates with central bank comments from third paragraph.)

Oct. 20 (Bloomberg) -- The Polish interest rates may remain unchanged in the coming quarters as inflation slows amid weakening economic growth, the central bank’s rate-setting Monetary Policy Council said.

The Narodowy Bank Polski kept the seven-day interest rate at 4.5 percent for a third meeting this month, relying on four quarter-point rate increases in the first half of the year to tame price growth. Policy makers said slowing economic growth will help bring inflation to within the bank’s 2.5 percent target in the medium term, according to minutes from the Oct. 4- 5 meeting.

Some council members argued that in subsequent quarters, interest rate increases are more likely than cuts, especially if inflation remains above the target for a period longer than currently anticipated “due to the depreciation of the zloty triggered by turmoil in international financial markets,” according to the minutes.

Some indicated that a potentially “significant” slowing of growth in Poland as a result of weaker economic activity abroad may, given the expected decline in inflation, justify a reduction of interest rates in the future, the bank said.

The inflation rate fell to 3.9 percent in September from 4.3 percent in August. That data were released after the Oct. 4- 5 rate-setting meeting.

--Editors: Alan Crosby, Balazs Penz

To contact the reporters on this story: Dorota Bartyzel in Warsaw

To contact the editor responsible for this story: Balazs Penz at

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