Reuters logo
UPDATE 1-Poland's Glapinski sees steady rates in 2017 despite inflation pick-up
March 8, 2017 / 6:41 PM / 9 months ago

UPDATE 1-Poland's Glapinski sees steady rates in 2017 despite inflation pick-up

(Adds quotes, details)

By Pawel Sobczak and Marcin Goettig

WARSAW, March 8 (Reuters) - Poland’s central bank is set to keep interest rates unchanged this year or even longer unless inflation accelerates significantly, the bank’s governor Adam Glapinski said on Wednesday.

Speaking after the bank held its key rate at a record low of 1.50 percent, Glapinski reiterated that inflation will probably ease slightly at the turn of the year and later stabilise.

“If current tendencies are maintained then until the end of this year I see no reason to think about changing the level of interest rates,” Glapinski told a news conference after the rate decision.

The central bank’s new forecasts showed it currently saw inflation at a range of 1.6-2.5 percent in 2017, up from 0.5-2.0 percent in the last forecast in November. The new forecast also showed inflation at 0.9-2.9 percent in 2018.

The central bank targets inflation at 2.5 percent with a fluctuation band of 1.5-3.5 percent.

Price growth accelerated to 1.8 percent in January and economists polled by Reuters expect it to reach 2.1 percent in February, pushing inflation-adjusted rates into negative territory.

“The situation may change if there are some unexpected events. For example, the results of elections in France or Germany and oil prices may change something here,” Glapinski said, referring to the current wait-and-see stance.

“If we see that there is some tendency during a few quarters that there has begun some process of accelerating inflation or inflation remaining at a heightened level then we will react. So far we do not see this happening,” he said.

Glapinski signalled that rates could remain unchanged even beyond the end of 2017.

“There would be no reason to increase rates in this period that I am talking about ... until actually the end of next year. But I would not go that far of course,” he said.

Analysts polled by Reuters expect that the 10-member rate-setting Monetary Policy Council (MPC) will keep rates stable until a hike in early 2018.

“All in all, we believe ... that the MPC will not rush with monetary tightening unless there is a very strong surprise on the side of inflation tendencies,” BZ WBK bank said in a note. (Reporting by Pawel Sobczak, Pawel Florkiewicz, Marcin Goettig and Bartosz Chmielewski, editing by Ed Osmond; Writing by Marcin Goettig)

0 : 0
  • narrow-browser-and-phone
  • medium-browser-and-portrait-tablet
  • landscape-tablet
  • medium-wide-browser
  • wide-browser-and-larger
  • medium-browser-and-landscape-tablet
  • medium-wide-browser-and-larger
  • above-phone
  • portrait-tablet-and-above
  • above-portrait-tablet
  • landscape-tablet-and-above
  • landscape-tablet-and-medium-wide-browser
  • portrait-tablet-and-below
  • landscape-tablet-and-below