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Poland will have single-digit inflation in 2023: central bank chief

08.12.2022 23:45
The head of Poland’s central bank (NBP) has said the country is on track to avoid recession while inflation is expected to fall to the single digits in 2023.
Adam Glapiński.
Adam Glapiński.PAP/Radek Pietruszka

Adam Glapiński made the remark at a news conference in Warsaw on Thursday, Polish state news agency PAP reported. 

He told the media: “We don’t envisage recession in Poland, but GDP growth may fall to around zero. According to our forecasts, it will be 0.7 percent, although this depends on multiple factors.”

He added that economic growth was decelerating "across the developed world," with many countries heading for recession. 

“In particular Poland’s main economic partner, Germany, will very likely fall into a recession,” Glapiński said. 

He added that “across the world, the situation is slowly becoming conducive to a decrease in inflation.”

“The rate of economic growth is falling and while inflation remains very high, it will start to fall, as well,” he told reporters.

He also said that, according to the central bank's forecasts, inflation in Poland would keep rising in the first two months of 2023. 

He told reporters: “We expect inflation to start falling systematically and fast from the end of the first quarter, namely from March or April. It will be a lasting process that will happen in both Poland and elsewhere.”  

Glapiński stated: “Poland will soon be a country with single-digit inflation, as soon as next year, and with fairly decent economic growth, compared to the rest of Europe and the world.”

He told reporters that inflation would drop to "between 6 and 9 percent" by the end of 2023, the strefainwestorow.pl website reported. 

He further said that “over the next decade, Poland’s GDP per capita could reach the level of France.” 

Interest rates

Referring to interest rates, Glapiński said the tightening cycle had been “suspended” rather than “completed,” adding: “if the hydra of inflation rears its ugly head again, we’ll raise interest rates.”

On Wednesday, the NBP’s rate-setting Monetary Policy Council left interest rates unchanged, keeping the reference rate at 6.75 percent, officials said.

The panel earlier delivered a string of rate hikes in an effort to contain surging consumer prices.

The Monetary Policy Council in September raised key interest rates for the 11th consecutive time in a bid to tame inflation.

The reference rate at the time went up by 25 basis points to 6.75 percent, from 6.50 percent, amid rising inflation.

Prime Minister Mateusz Morawiecki said in October last year that he expected “an appropriate response” from the central bank to the fastest price growth in the country in 20 years.

Inflation in Poland hit 17.4 percent last month, according to a flash estimate by the country’s statistics office.

The Polish central bank’s target inflation rate sits in the middle of a range from 1.5 percent to 3.5 percent, the PAP news agency reported.  


Source: PAP, strefainwestorow.pl