NBP MPC Press Release - 2012-10-03
Central bank: nbp | Type: decision | Date: 2012-10-03

N a t i o n a l B a n k o f P o l a n d 
M o n e t a r y P o l i c y C o u n c i l 
 
 
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Warsaw, 3 October 2012 
 
INFORMATION FROM THE MEETING OF THE MONETARY POLICY 
COUNCIL 
held on 2-3 October 2012 
The Council decided to keep the NBP interest rates unchanged: 
 reference rate at 4.75% on an annual basis; 
 lombard rate at 6.25% on an annual basis; 
 deposit rate at 3.25% on an annual basis; 
 rediscount rate at 5.00% on an annual basis. 
Available data indicate that global economic activity in 2012 Q3 remained low. Recession in 
the euro area was accompanied by merely moderate growth in the United State s. At the same 
time, many emerging economies saw further slowdown in economic growth. Taking into 
account unfavourable outlook for economic growth, central banks of major developed 
economies further eased their monetary policy in September, primarily, by a nnouncing the 
expansion or launch of new quantitative easing programs. 
Stronger monetary expansion pursued by major central banks has brought some improvement 
in the sentiment in the international financial markets, supporting prices of some financial 
assets. At the same time, due to the worsening outlook for global economic growth, the rise in 
commodity prices in the world markets was halted. Although low global economic activity 
supports inflation decline, still relatively high commodity prices contribut e to inflation 
remaining elevated in many countries. 
The data on economic activi ty in Poland in July and August, including ongoing deceleration of 
industrial production, persisting decline in construction output and further decrease in retail 
sales growth, point to a continued downturn in economic conditions in 2012 Q 3. Also data on 
labour market developments, including fall in employment and low wage growth in the 
corporate sector and gradually rising unemployment rate , signal a possible slowdown in 
demand from the private sector. This is also indicated by the worsening of most economic 
sentiment indicators. 
Economic slowdown is accompanied by a gradual deceleration in lending to households, 
including further decline of consumer loans, and continued moderate rise in lending to 
corporates. 
In August, CPI inflation fell again to 3.8% , however, it remained above the NBP’s inflation 
target of 2.5%. At the same time, there was a decline in inflation net of food and energy prices 
and a slight drop in inflation expectations of households and of corporate sector. 
 
2 
 
In the opinion of the Council , inflation will decrease gradually over the coming months, as the 
statistical base effect wanes amidst slowing demand in the economy. However, it will remain 
above the inflation target of 2.5% until the end of 2012. In the medium term, the slowdown in 
economic growth will contribute to inflation returning to the target while high commodity 
prices in the global markets remain an upward risk to inflation decline. 
The Council decided to keep the NBP interest rates unchanged. 
Should the incoming data, including the November inflation projection of the NBP , confirm 
that economic slowdown would become protracted, while the risk of increase in inflationary 
pressure be limited, the Council will ease monetary policy.