Important MPC decision. Interest rates are falling sharply

At its meeting in September, the Monetary Policy Council (MPC) decided to cut interest rates by 75 basis points.

The MPC cut interest rates in the case of the reference rate by 75 bps to 6%. – the Polish central bank said in an official statement on Wednesday, quoted by ISBnews.pl.

“The Council has set the NBP interest rates at the following level:

  • reference rate: 6 percent on an annual basis;

  • Lombard rate: 6.50 percent on an annual basis;

  • deposit interest: 5.50 percent on an annual basis;

  • Rediscount rate for promissory notes: 6.05 percent. on a yearly basis;

  • discount rate on the bill of exchange: 6.10 percent. on a yearly basis.

The MPC resolution will enter into force on September 7, 2023.

Breakthrough decision of the MPC

This is the first change in NBP interest rates since September 2022.

The Monetary Policy Council raised interest rates from October 2021 (from 0.1%) to September 2022. In the months that followed, it left the parameters of monetary policy unchanged.

GUS: Inflation in August

Last week, the Central Bureau of Statistics reported that consumer inflation in August was 10.1 percent. on an annual basis, according to provisional data. Compared to the previous month, prices of consumer goods and services remained unchanged. The market consensus was: 10 percent. per year and 0 percent. monthly. Prices of food and non-alcoholic drinks increased by 12.7%. on an annual basis, energy carriers increased by 13.9 percent and fuels for private means of transport by 6.1 percent.

At a press conference following the meeting of the Monetary Policy Council in July, the President of the National Bank of Poland and the Chairman of the Monetary Policy Council, Adam Glapiński, announced that the interest rate cut would be on a scale of “0.25 percentage points. This is possible at the next Council decision-making meeting in September, assuming single-digit inflation and 90% certainty of its further decline.

Source: Do Rzeczy

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