By CentralBankNews.info
Poland’s central bank left its benchmark reference rate unchanged at 1.50 percent, saying it expects inflation to slowly rise in coming quarters as the economy’s output gap slowly closes but the risk of a sharper slowdown in emerging economies remains a source of uncertainty about how fast inflation will return to the bank’s target.
The National Bank of Poland (NBP), which has cut its rate by 50 basis points this year, said there were no inflationary pressures due to moderate demand and the negative output gap and the sharp drop in global commodity prices remains the main risk for continued deflation.
But Poland’s economy continues to expand, with the domestic demand the main driver, supported by a robust labor market, strong consumer confidence, improved finances in companies and stable lending growth.
Inflation in Poland was steady at minus 0.8 percent in October and September and the central bank said its November forecast calls for 2015 inflation of minus 0.9 percent to minus 0.8 percent compared with the September forecast of minus 1.1 percent to minus 0.4 percent.
For 2016 the NBP expects inflation of 0.4 to 1.8 percent compared with its previous forecast of 0.7 – 2.5 percent and for 2017 inflation is seen averaging 0.4 – 2.5 percent compared with 0.5 – 2.6 percent.
The NBP targets inflation of 2.5 percent, plus/minus 2 percentage points.
The forecast for 2015 economic growth was lowered to 2.9 – 3.9 percent from July’s forecast of 3.0 to 4.3 percent and the 2016 forecast was trimmed to 2.3 – 4.3 percent from 2.3 – 4.5 percent. For 2017 the central bank forecast growth of 2.4 – 4.6 percent as compared to 2.5 – 4.7 percent.
In the second quarter of this year, Poland’s Gross Domestic Product expanded by an annual 3.3 percent, down from 3.6 percent in the first quarter.
The National Bank of Poland issued the following statement:
The Council decided to keep the NBP interest rates unchanged. The Council adopted Inflation Report – November 2015.”
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