NBP: Governor Adam Glapinski's Presser Eyed This Afternoon 1/2

NBP Governor Adam Glapinski will hold a press conference at 14:00BST/15:00CEST after the MPC left interest rates unchanged and introduced minor tweaks to the statement. Policymakers removed a reference to "substantial uncertainty" around energy prices; instead they said that "consumer price growth is likely to increase and will be running above the NBP inflation target, which will be driven by the raised energy prices" - even as "inflation should return to the medium-term NBP target" despite uncertainties. They also changed the phrase "demand pressure in the domestic economy is stimulated by a marked wage growth" from future to present tense.

• ING expect the Governor to maintain a hawkish tone of his rhetoric today. In their view, the revisions to macroeconomic forecasts were consistent with expectations and earlier communications. They stress that the March projection involved two distinct scenarios, hence direct comparisons with the July projection are impossible, while also suggesting that the newest one points to a significantly softer inflationary pressure in the near term and persistent pressure over the medium term.
• mBank don't see any groundbreaking changes in the statement. They think that the new inflation projection suggests that NBP staff assumed that the revised (higher) energy price caps will expire at the beginning of 2025. They expect the actual evolution of energy prices to be smoother, due to the anticipated coordination between the government and the energy regulator (hence the 2025 CPI forecast seems overly pessimistic, in their view). Their baseline scenario remains the same, assuming no rate adjustments this year and modest easing in 2025 when the projection shows a declining inflation path.