There is still room for lowering Poland's benchmark interest rate, Finance Minister Jacek Rostowski said during a budget debate in the Senate. Over the last six months, Poland had the second-highest interest rates in the EU, he added, and this was an additional burden that inhibited growth in the country's economy.
The room for interest rate cuts comes from the lowering of Poland's structural deficit by over 4 percentage points in 2010-2012, Mr Rostowski explained. “But unfortunately the Monetary Policy Council did not take on a more accommodative, a more expansive policy in the autumn of 2012 and in 2013,” he added.
Meanwhile, Monetary Policy Council (RPP) member Andrzej Bratkowski told the Polish Press Agency that the council is unlikely to change interest rates until the second half of 2014, unless the economic rebound is more rapid than expected.
“It's basically quite clear that we will do nothing until the end of the year. It also seems very likely that we will do nothing by mid-next year,” Mr Bratkowski said. “And there is a likelihood that we will do little in the second half of next year. Or nothing at all.”
The central banker added that rate increased are more probable in Q4 than Q3 2014. The RPP may start thinking of higher rates when GDP growth exceeds 3 percent, he said.
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