July 11, 2018 / 4:05 PM / 8 months ago

UPDATE 1-Polish c.bank head says no need to change rates until end-2020

* Polish c.bank keeps rates unchanged, at 1.5 pct, as expected

* Raises GDP growth forecast for 2018 to 4.0-5.2 pct

* Cuts CPI forecast for 2018 and 2020

* Central bank head says no need to change rates until end-2020 (Adds details from new c.bank forecast)

By Pawel Sobczak

WARSAW, July 11 (Reuters) - Poland’s central bank governor Adam Glapinski said on Wednesday he still saw no need to change interest rates until the end of 2020, after the bank presented new forecasts that projected a shallower inflation path than previously.

The bank is projecting inflation of 1.5-2.1 percent this year, less than the 1.6-2.5 percent it foresaw in March, rising to 1.9-3.5 percent next year, a change from the 1.7-3.6 percent range it expected in March.

“It reinforces my personal view that until the end of 2020 there will be no change,” he told news conference, after the bank decided to keep its key interest rate at the 1.5 percent historic low it has maintained for more than three years.

Economic growth this year was seen at 4.0-5.2 percent, up from 3.5-5.0 percent in the bank’s previous forecasts.

“The new inflation report brings small cosmetic changes only. Since then the rhetoric was not changed and the Monetary Policy Council’s stance remained unchanged,” Stanislaw Janecki, chief economist at Societe Generale in Warsaw, said.

But he said inflation might accelerate in 2019, adding: “An interest rate hike will be more probable in the second part of next year.”

Analysts polled by Reuters expect interest rates to be increased by 25 basis points in the first quarter of 2020.

Analysts said the decision and MPC comments were neutral for the zloty, as investors are focused more on developments in foreign markets. At 0300 GMT the Polish currency was quoted at 4.3327 to the euro, almost unchanged since morning.

Glapinski said on Wednesday he was not concerned about the zloty and that the Polish currency has very strong fundamentals.

Reporting by Pawel Sobczak; Additional reporting by Kacper Jelowicki; Writing by Marcin Goclowski; Editing by Catherine Evans

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