# Polish central bank holds rates, points to slowdown ahead
Author:  Pal Sinha, Barnali 
Author URL: https://financedigest.com/author/pal-sinha-barnali
Published: 2022-10-06
Category: NEWS
Category URL: https://financedigest.com/category/news
Meta Title: Polish National Bank keeps main interest rate at 6.75% amid
Meta Description: Stay updated on the National Bank of Poland's decision to maintain its 6.75% interest rate amid rising inflation, economic slowdown warnings, and regional
URL: https://financedigest.com/polish-central-bank-holds-rates-points-to-slowdown-aheadhtml

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By Anna Koper

WARSAW (Reuters) -The National Bank of Poland (NBP) kept its main interest rate on hold at 6.75% on Wednesday, it said, opting to leave borrowing costs unchanged despite soaring inflation as it warned of an economic slowdown in the coming months.

With regional peers finishing monetary tightening cycles, Polish policymakers had also signalled that the end of rate hikes was near.

However, with [inflation rising](https://www.financedigest.com/uk-inflation-rate-unexpectedly-rises-to-10-4-in-february.html "UK inflation rate unexpectedly rises to 10.4% in February") to 17.2% in September, the highest since 1997, most economists had predicted that the cost of credit would continue to rise.

Economists polled by Reuters had expected the main [rate to rise](https://www.financedigest.com/oil-falls-as-earthquake-impact-on-crude-eases-rate-hike-fears-rise.html "Oil falls as earthquake impact on crude eases, rate hike fears rise") to 7.00%.

The Council assessed, that the hitherto significant [monetary policy](https://www.financedigest.com/uks-ftse-100-dips-on-scope-of-tighter-monetary-policy-informa-jumps.html "UK’s FTSE 100 dips on scope of tighter monetary policy; Informa jumps") tightening by NBP… will contribute to curbing demand growth in the Polish economy, which will support a decline in [inflation in Poland towards the NBP inflation target,” the banks](https://www.financedigest.com/boes-bailey-says-rate-setters-can-put-inflation-before-bank-worries.html "BoE’s Bailey says rate-setters can put inflation before bank worries") said in a statement.

The [bank said it expected economic growth to slow in the coming](https://www.financedigest.com/central-banks-hike-rates-again-but-a-pause-is-coming.html "Central banks hike rates again, but a pause is coming") quarters.

In our opinion, the economic situation in Europe and the USA shows that there is less room for further [rate hikes,”](https://www.financedigest.com/central-banks-keep-hiking-rates-amid-banking-turmoil.html "Central banks keep hiking rates amid banking turmoil") the Polish Economic Institute said in a note.

Possible further [increases will be a reaction to unexpected increases in inflation](https://www.financedigest.com/global-medical-costs-expected-to-increase-in-2017-despite-lower-rates-of-inflation.html "Global Medical Costs Expected to Increase in 2017 Despite Lower Rates of Inflation") or strong currency depreciation.

However, ING analysts said that they expected further tightening in 2024 due to high inflation, and said that relying on an economic slowdown to curb [price growth](https://www.financedigest.com/liverpool-shines-as-one-of-uks-leading-ladies-for-house-price-growth.html "Liverpool shines as one of UK’s leading ladies for house price growth") was “risky.

The Polish zloty was 0.48% weaker against the euro at 1420 GMT.

The [Polish decision follows similar moves](https://www.financedigest.com/transfer-firm-moves-into-polish-markets-with-the-unbanked-in-mind.html "Transfer Firm Moves Into Polish Markets With The Unbanked In Mind") in Hungary and the Czech Republic.

In Hungary the central bank [raised its base rate by a larger-than-expected 125 basis points](https://www.financedigest.com/how-to-raise-my-credit-score-40-points-fast.html "How to raise my credit score 40 points fast") to 13% in September but said it was ending its rate-hike cycle amid a slowing economy, while in the Czech Republic policymakers kept rates steady at 7.00% for a second time in a row.

Romania’s [central bank](https://www.financedigest.com/inflation-trumps-financial-risks-as-central-bank-tightening-set-to-continue.html "Inflation trumps financial risks as central bank tightening set to continue") lifted its benchmark interest rate by a more than expected 75 basis points to 6.25% on Wednesday.

(Reporting by Alan Charlish, Anna Koper, Pawel Florkiewicz, Anna Wlodarczak-Semczuk, Editing by William Maclean and Gareth Jones)


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