Polish MPC strikes a more dovish tone

The Polish National Bank’s Governor, Marek Belka, was more dovish at this afternoon’s post-meeting press conference, and didn’t rule out the possibility of a cut in interest rates this year. However, while inflation is likely to remain extremely subdued, the MPC does not see deflation as a central scenario, which suggests that looser monetary policy is unlikely. This all supports our long-held view that interest rates are likely to remain at their current historic low well into next year.