MNI NBP Review - November 2022: Decision Shows Scale of Concern Over Growth

Executive Summary:

• The NBP left rates unchanged against split consensus of no change or a 25bps hike
• Policy statement includes new inflation projections, with the view on prices bumped higher, while GDP forecasts were downgraded
• Decision implies the board willing to look through near-term inflationary pressure

NBPRevNov22.pdf

The NBP left its policy rate unchanged at 6.75% in their November meeting against split consensus between unchanged rates and a +25bp hike. Notably, the decision came in much later than usual, at 1725 UK time/1825 CET, suggesting an extended dispute between the hawkish minority of the MPC and the rest of the board.

The unchanged decision has prompted further division among the sell-side, with some analysts acknowledging the lack of a rate hike this month as making future tightening less likely. Others, however, retain their call for additional rate hikes this cycle as fiscal easing and a deteriorating current account in 2023 force the bank’s hand. As a result, the press conference with NBP’s Glapinski will take focus going forward.