Dabrowski Says There Could Be Room For Monetary Easing By End-2023 But NBP Won't Act Hastily

NBP's Ireneusz Dabrowski told Parkiet TV in an interview that "there may be some room for monetary easing at the end of the ear but we won't be acting hastily," as "it seems that we are on the road where inflation will be easing" and "the worst is behind us."

• The policymaker noted that the prospect of disinflation seems to be reflected in the behaviour of price-setters, with enterpreneurs ceasing to increase their profit margins.
• Dabrowski highlighted rising profit margins as an important driver of inflation, suggesting that producers were acting pre-emptively when inflation was accelerating.
• "Inflation is definitely under control," while "core inflation will be easing" going forward, as wage growth should decelerate alongside inflation expectations.
• Dabrowski notes that the central bank remains ready to raise interest rates if such a need arise, adding that this is the formal stance of the MPC as a collective body.
• The language used by Dabrowski to describe the conditions for raising interest rates suggests that the bar is high as he sees all evidence supporting the current strategy.
• Dabrowski said that he does not see hawkish risks stemming from the prospect of looser fiscal policy in the election year.
• The official says that there could be some room for lowering interest rates by the year-end "if nothing changes" but such decision "would be well thought-out."