MNI NBP Review - Nov 2024: Looking Forward To Cuts
Executive Summary:
• The MPC kept interest rates on hold, in line with consensus.
• Debate on monetary easing could start in March.
• Rates will likely be cut when inflation peaks and is projected to decline.
Click here to see the full review: NBP Review - November 2024.pdf
The National Bank of Poland (NBP) extended the period of interest-rate stability, but Governor Adam Glapiński outlined the conditions for the re-start of monetary easing next year. Despite ruling out rate cuts at least until the publication of the next inflation projection in March, with inflation set to remain elevated at the turn of the year, the Governor said that the end of Q1 could see renewed discussion about loosening monetary policy, followed by the first cut. The combination of inflation being past its peak, a stabilisation of inflation, and the prospect of a sustainable decline to the target would enable the Monetary Policy Council (MPC) to reduce interest rates. In addition, the Governor flagged the MPC’s overall bias towards easing policy as soon as conditions allow it and signalled that the initial move could involve a 50bp cut.