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Central bank chief predicts further drop in Polish inflation

08.12.2023 07:30
Poland's inflation rate will continue to decline in the coming quarters and is expected to reach 2.5 percent within the next two years, the head of the country's central bank has said.
Adam Glapiński, the head of Polands central bank.
Adam Glapiński, the head of Poland's central bank.PAP/Radek Pietruszka

Adam Glapiński, the governor of the National Bank of Poland (NBP), made the prediction at a news conference in Warsaw on Thursday.

The central bank chief said: "According to the NBP's forecasts, Poland's inflation will continue to fall in the coming quarters."

He added that "the decrease in inflation will continue," albeit not as dynamically as in recent months, during which the consumer price index dropped from 18.4 percent in February to 6.5 percent in November, the PAP news agency reported.

Glapiński said inflation would fall thanks to "the previous tightening of monetary policy, mainly through interest rate increases" and because economic growth was modest for now.

The central bank chief added that he expected inflation to reach the NBP's target of 2.5 percent, falling within a range of 1.5 percent to 3.5 percent, during the next two years, the PAP news agency reported.

On Wednesday, the Polish central bank's rate-setting Monetary Policy Council left interest rates unchanged, keeping the reference rate at 5.75 percent. 

Earlier this year, the panel slashed key interest rates by a combined 100 basis points, amid signs of subsiding inflation.

In late 2021 and last year, the Monetary Policy Council had delivered a string of rate hikes in an effort to contain surging consumer prices.

Inflation in Poland stood at 6.5 percent last month, down from 6.6 percent in October, according to a flash estimate by the country’s statistics office.

The Polish central bank said in its latest Inflation Report, released on November 10, that inflation would average at 11.4 percent this year, followed by 4.6 percent in 2024 and 3.7 percent in 2025.

(pm/gs)

Source: PAP, Polsat News