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Lower growth and inflation could mean cut in borrowing rate

PR dla Zagranicy
Peter Gentle 05.07.2012 09:25
Governor of the National Bank of Poland (NBP) Marek Belka, has warned that though Poland's economy is still outpacing other EU member states, there are signs that GDP growth is slowing down.

Marek Belka, Wednesday: photo - PAP/Tomasz Gzell

"If we compare the situation today with that of two months ago, we certainly have greater concern about economic growth but less concern about inflation," Belka, a former prime minister of Poland, said after a meeting of the Monetary Policy Council (MPC) on Wednesday.

On monetary policy, Belka said that the MPC, when looking at interest rate levels, said that, “we try to keep the economy in balance and prevent the accumulation of imbalances”.

The MPC - who left the borrowing rate unchanged yesterday - raised interest rates in Poland for the first time in 10 months in May, with the reference rate now at 4.75 percent.

Monetary Policy Council member Andrzej Kazmierczak said Wednesday, however, that, if inflationary pressures continued to ease, as growth slows, a possible reduction of interest rates is on the cards.

“If the fall in inflation is permanent, the it would, of course, be possible to cut interest rate cuts,” he said. (pg)

source: PAP

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