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    Poland’s Inflation Decline to Slow Down, Says Central Bank Chief

    In a press conference held on Thursday, Adam Glapinski, the governor of Poland’s central bank, projected a continued decrease in the country’s inflation, albeit at a slower rate than observed thus far.

    Glapinski revealed that despite maintaining interest rates at 5.75 percent, as decided by the Monetary Policy Council (MPC) the day before, the pace of inflation reduction would decelerate. He emphasized that reaching the inflation target of 2.5 percent with a variance of +/- 1 percentage point, set by the Polish Press Agency (PAP), is anticipated no earlier than the end of 2025. This timeline, according to Glapinski, has remained largely unchanged since July, despite a cumulative 1 percentage point reduction in interest rates.

    The governor underscored the uncertainty surrounding the future trajectory of disinflation, citing it as a crucial factor in the decision to halt interest rate cuts in November. Glapinski highlighted that the upcoming inflation projection, scheduled for release in March, would play a pivotal role in shaping future monetary policies.

    Glapinski acknowledged that factors such as recent general elections on October 15 and geopolitical events, including the conflict in the Middle East, contributed to the decision to maintain current interest rates. He noted that absent these events, the MPC might have continued with interest rate cuts at the November meeting and potentially beyond.

    The October flash estimate from Poland’s statistics office, GUS, indicated a 6.5 percent year-on-year increase in consumer prices, reinforcing the central bank’s cautious approach amid ongoing uncertainties. The MPC, in justifying its decision, pointed to uncertainties surrounding forthcoming fiscal and regulatory policies and their potential impact on inflation.

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