Poland central bank left its key interest rate unchanged on Thursday, after the first rate-setting session of the new policy-making body.
The Monetary Policy Council of the National Bank of Poland, led by President Marek Belka, decided to maintain the key reference rate at 1.50 percent.
The decision was in line with economists’ expectations. Previously, the bank lowered the rate by 50 basis points in March last year.
The lombard rate was kept at 2.50 percent and the deposit rate at 0.50 percent. The rediscount rate was left unchanged at 1.75 percent.
The central bank is in the process of appointing the new MPC members and the press conference scheduled for Thursday afternoon will be keenly watched for hints of any shift in the policy stance.
“We wouldn’t be surprised to see a slightly more dovish tone in the communications, although we don’t expect any near-term moves in interest rates,” Capital Economics economist William Jackson said.
The concern is that with the newly-elected populist Law and Justice government dominating parliament, the new-look MPC will be more inclined to lower interest rates aggressively, the economist noted.
“However, a sudden shift in the Council’s stance would damage its credibility and, more generally, would reinforce concerns about the move towards more populist policymaking in the country,” Jackson added.
The material has been provided by InstaForex Company – www.instaforex.com