Bloomberg News

Belka Says Polish Central Bank Sees ‘Strong’ Slowdown Symptoms

July 04, 2012

Polish central bank Governor Marek Belka commented today on the outlook for interest rates after the Monetary Policy Council kept the main interest rate at 4.75 percent, matching the forecast of all 34 economists surveyed by Bloomberg.

The following are selected comments from Belka at a news conference in Warsaw following the rate decision.

On economic growth:

“Members of the Monetary Policy Council are analyzing the incoming data and we’re seeing strong symptoms of an economic slowdown.

“I’m certainly more worried about economic growth and less worried about inflation than I was two months ago.

“I wouldn’t like to delete the last sentence of our statement because that would mean our economic situation is deteriorating faster than we’d thought.”

On interest rates:

“I wouldn’t say that our statement today signals change in our policy bias.

“We continue to be vigilant.

“If we see a worse scenario for the economy materializing then we’ll be less inclined to raise rates further. Nevertheless, most members of the Monetary Policy Council believe that meeting our inflation target requires positive real interest rates. Our previous increase was a step toward normalizing the level of interest rates. We’re probably not there yet, but the situation is making it harder for us.

“The inflation outlook is improving, so we can take our time to fully normalize rates.”

“Our rate moves will have an impact on the economy in 2013. Whether we raise or lower rates depends on how the economic situation develops. We need to see whether the weakening in growth that we saw in the first quarter continues.”

On inflation:

“It’s hard to hold it against the Monetary Policy Council that we’re so interested in inflation. That’s our mandate.

“Poland is one of the few countries that can afford to conduct a conventional monetary policy and that means we have to act against the buildup of imbalances in the economy.”

To contact the reporters on this story: Piotr Skolimowski at

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

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