National Bank of Poland

January 5, 2022

The National Bank of Poland engineered the first central bank interest rate hike of 2022, lifting such by 50 basis points yesterday to 2.25%. This was the fourth increase since October before which the rate had been just 0.10%. Polish CPI inflation of 7.8% is its highest of the 21st century and about five percentage points above its targeted range midpoint. Spikes in many global commodity prices and supply chain bottlenecks are primarily responsible for lifting inflation to these heights. “Ongoing economic recovery, including demand driven by rising household income, has also added to an increase. Amidst further economic recovery and expected continuation of favorable labor market conditions, as well as probably more lasting impact of external shocks on price dynamics, there persists a risk of inflation running above the NBP inflation target in the monetary policy transmission horizon.”

Copyright 2022, Larry Greenberg. All rights reserved. No secondary distribution without express permission.

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