Polish rates seen unchanged until possible hike in Q4 2017

05 Sep, 2016

WARSAW: Poland's central bank is expected to leave interest rates unchanged before raising them at the end of 2017, a Reuters poll showed on Monday.

The poll was taken mostly before Marek Chrzanowski announced on Monday that he had quit Monetary Policy Council (MPC).

His departure is unlikely to change interest rate policy, analysts said.

All 16 analysts polled by Reuters on Sept. 2 and Sept. 5 expect the MPC to keep its benchmark rate at 1.50 percent on Wednesday.

The median forecast called for no change until a possible hike in the fourth quarter of 2017.

The central bank cut rates by half a percentage point last March to a record low, then announced its rate-cutting cycle was over. Rates have not changed since then.

Most of the rate-setters have so far expressed reluctance to change borrowing costs anytime soon. Jerzy Zyzynski, see as the most dovish of the 10 rate-setters, has said he may file a motion to cut rates after the summer.

Economists say worries over the profitability of banks and the exchange rate of the zloty outweigh concern that deflation, which took hold nearly two years ago, could damage the economy.

Copyright Reuters, 2016

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