Poland will experience a gradual drop in GDP and its Consumer Price Index (CPI) in the coming years, the Monetary Policy Council (RPP) said on Wednesday.
The rate-setting council said a GDP drop was expected in the coming quarters, and that Poland’s central bank will take all measures to reduce the risk of inflation hitting new highs.
According to Poland’s Central Statistical Office (GUS), August inflation in Poland rose to 16.1 per cent, year on year.
But, according to the RPP, the drop in GDP along with a slow-down in the economy and a strengthening zloty would help lower inflation.
The council on Wednesday also reiterated its earlier warning that inflation could settle above the central bank’s target, and said it planned further interest hikes as a countermeasure.
The RPP said the high inflation rate resulted mainly from the soaring price of energy caused by Russia’s invasion of Ukraine.
On Wednesday the RPP raised the reference rate by 25 base points to 6.75 per cent.