Poland’s National Bank (NBP) is expected to maintain its base rate at 3.75% during its October monetary policy decision, according to consensus forecasts cited by Commerzbank’s Tatha Ghose [1]. The upcoming press conference is highlighted as a key event, with market participants watching closely to see if NBP President Adam Glapinski will signal the possibility of future rate hikes [1].
Several members of the Monetary Policy Council (MPC) have indicated that a rate-hike discussion is likely in October, though an actual move is not anticipated at this meeting. Ludwik Kotecki, an MPC member, expects that November’s new macroeconomic projections could provide grounds for one or two 25 basis point increases if inflation is projected to exceed 4% in the coming year [1].
Recent inflation data supports this cautious shift. Headline Consumer Price Index (CPI) accelerated to 4% year-on-year in September, up from 3.4% in August. Seasonally-adjusted month-on-month CPI increased by 0.62% after smoothing, indicating that underlying inflation momentum has re-accelerated above the NBP’s target [1].
Despite these inflationary pressures, the NBP’s current easier monetary stance is seen as weighing on the Polish Zloty (PLN), especially if the central bank does not adopt a more hawkish tone at the upcoming press conference. In comparison, the Czech National Bank (CNB), facing less inflation momentum, is expected to hike rates in November, while the NBP appears more inclined to wait for further projections before acting [1].
CONCLUSION
The NBP’s decision to hold rates steady amid rising inflation has put pressure on the Polish Zloty, with markets awaiting signals of a potential policy shift. The upcoming press conference and November’s projections are seen as pivotal for future rate decisions. Unless the NBP adopts a more hawkish stance, the Zloty may remain under pressure.