The National Bank of Poland (NBP) is widely expected to maintain its policy rate at 3.75% for a second consecutive meeting, according to Brown Brothers Harriman’s (BBH) Elias Haddad [1]. This move would effectively signal the end of the NBP's 200 basis point easing cycle that has taken place over the past year [1].
Key data points influencing this decision include headline and core Consumer Price Index (CPI) inflation, which are currently running above the NBP’s Q1 projections of 2.2% and 2.6%, respectively [1]. The persistence of inflation above target levels, combined with a favorable balance of payments, has resulted in positive real rates, which continue to support the Polish Zloty (PLN) [1].
Haddad notes that the NBP is likely to communicate the conclusion of its easing cycle, reinforcing expectations for a stable policy environment moving forward [1]. The market implication is that the PLN remains underpinned by these positive real rates and macroeconomic fundamentals, with no immediate indication of further rate cuts [1].
CONCLUSION
The National Bank of Poland is expected to keep rates unchanged at 3.75%, signaling an end to its recent easing cycle. Persistently high inflation and positive real rates are supporting the Polish Zloty, with market participants anticipating a stable policy stance in the near term.