Poland: MPC to keep its policy rate on hold today - TDS

According to analysts at TDS, there is little doubt that the MPC will keep its policy rate on hold today at 1.5%.

Key Quotes

“Furthermore, the press statement will probably continue to suggest that the majority of the MPC expect rates to stay on hold for all of this year. Indeed inflationary remain muted with December preliminary headline inflation falling to 2.0% Y/Y from a prior 2.5%; core inflation in November was running even lower at 0.9%. However, given strong GDP and wage growth along with rising oil prices we see the risks to inflation as being skewed to the upside.”

“Our current forecast is for the first hike to come around the middle of this year, but, given the good December CPI data, this is more likely to be later than earlier. But in any event, we think rate hike expectations will steadily grow stronger as we move through the year giving support to the zloty.”