Minutes Of July Monetary Policy Meeting Released

The NBP released the minutes of its monetary policy meeting concluded on July 6, during which the central bank kept interest rates unchanged but also formally ended its tightening cycle.

• "At the Council meeting it was underlined that – in line with earlier predictions – inflation declined significantly. According to the Statistics Poland flash estimate, CPI inflation fell to 11.5% y/y in June 2023. It was observed that in the last four months inflation had declined by about 7 percentage points, and that June was the second month in a row in which the overall consumer price level had remained unchanged from the previous month."
• "Therefore, the majority of the Council members argued that the still high annual inflation rate was not resulting from current growth in the overall price level, but was reflecting past price changes in previous periods. It was pointed out that based on available data, it could be estimated that in June price growth of all the main groups included in the basket of consumer goods and services had declined, and that in particular core inflation had probably fallen markedly."
• "Certain Council members pointed out that the significant fall in inflation and declining inflation expectations amid unchanged interest rates were contributing to an increase in the restrictiveness of monetary policy. Under these circumstances, and also considering the prospect of a further fall in inflation and low economic activity growth, in the coming months it might be justified to consider lowering of the NBP interest rates."
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