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MPC members hint at growing chances for interest rate hikes

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Date: 2012-02-09 08:25

The Monetary Policy Council (MCP) upholds its stance that interest rate cuts are less likely than rate hikes, according to statements of governor of the National Bank of Poland (NBP) and MPC's chairman Marek Belka and fellow MPC member Zyta Gilowska.


Belka also stressed that MPC welcomes the recent strengthening of the Polish zloty as it helps bring consumer inflation to the 2.5% target.

We also note that the central bank's governor treats the expected good read-out of GDP growth for Q1 of 2012 to be one of the factors accelerating an interest rate increase.

Also, fellow MPC member Adam Glapinski declared that if the Q1 GDP growth is dynamic and inflation keeps hovering around 4.5% y/y (vs. December's 4.6%), he will put forward a motion for a rate hike.

Bank economists expect interest rates to remain flat (after their last cut in June of 2011) at least by the middle of this year.