Polish Monetary Policy Eased Again

July 3, 2013

Officials at the National Bank of Poland agreed to a further 25-basis point cut of the reference central bank interest rate to a record low of 2.5%.  The Lombard and deposit rates were cut similarly to 4% and 1%.  A statement from Narodowy Bank acknowledges the zloty’s depreciation since mid-May but attributes such to external central banking developments and justifies today’s action because of continuing weak domestic economic growth, low credit demand, a further drop of CPI inflation to 0.5% in May, low core inflation, a stronger decline in producer prices, and a a further decline in inflation expectations.

Prior to November 2012, the reference rate was 4.5%.  Then followed cuts of 25 bps in November, December, January 2013, and February, 50 bps in March, 25 bps in June and now 25 bps in July. 

Copyright 2013, Larry Greenberg.  All rights reserved.  No secondary distribution without express permission.

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