MNI NBP WATCH: Reference Rate Held At 5.75%, NBP Stays Hawkish
MNI (LONDON) - The National Bank of Poland delivered another hawkish policy hold on Thursday, leaving the reference rate at 5.75% for the 14th consecutive meeting, with inflation seen above target well into 2025. (See MNI EM NBPWATCH: Rate Hold Seen After Governor's Hawkish Tilt)
CPI inflation was 4.7% in December 2024 - unchanged from November - the NBP said in a statement, with the pickup in price pressures in H2 attributed “mainly” to increases in administered energy prices, followed by rising food and non-alcoholic drinks prices.
“In the Council’s assessment, in the coming quarters, inflation will remain markedly above the NBP inflation target, driven by the effects of the already-introduced increases in energy prices, as well as rises in excise duties and administered services prices,” the Bank said in a statement.
Wage growth continues to run at a high level, the NBP said, but is expected to decline gradually over the course of the year. (See MNI EM INTERVIEW: NBP Will Cut Before 2026 - Ex-FinMin Official)
After NBP governor Adam Glapinski placed emphasis in last month’s press conference on the significance of regulated prices in keeping inflation elevated, January’s statement returned to the theme.
“Unfreezing of energy prices in the second half of 2025 may contribute to extending the period of inflation staying above the target,” it said. “Inflation developments over the medium term will be also affected by the further fiscal and regulatory policy measures.”
Having apparently provoked a number of Monetary Policy Council members into commenting critically on his remarks last month, it will be interesting to see what message Glapinski conveys at Friday's news conference- and how his MPC colleagues react.