What awaits interest rates?
Monetary Policy Council In June, she did not change the amount of interest rates (the main one is still 5.25 percent) – and we expected this, as well as the previous announcements of the President of the NBP. Until recently, however, economists could also assume that in the following months the MPC will still cut the foot, because – as some described it – the conditions for this are perfect. This is not valid anymore.
Because we had on the way Presidential elections in Poland, which, however, slightly changed the picture of the situationand then yesterday (Thursday) Adam Glapiński's press conference. It was impossible not to notice that the president took on the hawks of the robe (Jastrzębie's approach in monetary policy assumes a greater tendency to higher interest rates, i.e. to strengthen, its opposite is the pigeon approach, mild and low feet). After this speech, economists began to bet that the MPC would be less willing than before as the foot cuts. And we just got a voice from the middle of the council itself, which confirms this.
I agree with the views of economists who provide for a lesser desire to advise you to make cuts after the presidential election
– said Ludwik Kotecki, a member of the MPCs of the Bloomberg agency. “With this political instabilitywhich can be expected now, it is difficult to expect significant fiscal consolidation, “he added. He believes that interest rates should fall either in July or September (in August the MPC has a holiday break from decision -making meetings). Cutting this year with a total of 50 base points would be” optimal “.
The council should no longer wait with cuts, because it can harm the economy. On the other hand, I am not so sure that the majority will support the reduction in July or September
– said Kotecki. That would mean freezing interest rates for longer. And basically it would be consistent with what he said at yesterday's press conference Adam Glapiñskiwho said that the MPC would make decisions taking into account the emerging new, key information.
Jastrzębi Adam Glapiński
– The situation is variable, uncertainsignals from the market, from the economy are mixed, which is why we can declare. As you know, next month we will have a new NBP projection, which is the basic determinant of the decision for us and it will help better assess perspectives inflation In the long run – announced the president of the NBP.
At the same time, new data, pay, sales and inflation will come. Unfortunately, in July we will still not know the price of electricity in the fourth quarter, and we will not know the project of next year's budget. Therefore, we do not announce any path of future interest rates today
– In such words he ended his speech (after him he got a few more questions from journalists, but the answers to them no longer changed the picture of the situation).
The Monetary Policy Council has 10 members, together with the president of the NBP, who acts as its chairman. Three choose: the President of the Republic of Poland, the Sejm and the Senate. Ludwik Kotecki is a “Senate” member, next to Przemysław Litwiniuk and Joanna Tyrowicz. The Sejm chose Iwona Duda, Wiesław Janczyk and Gabriela Masłowska to the MPC. “Presidential” members of the Council are: Ireneusz Dąbrowski, Cezary Kochalski and Henryk Wnorowski.
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Source: Bloombergpress conference prof. Adam Glapiński (you can see it at this link)