NBP MPC Press Release - 2010-04-28
Central bank: nbp | Type: decision | Date: 2010-04-28

National Bank of Poland 
 
Monetary Policy Council 
 
ul. Świ ętokrzyska 11/21, 00-919 Warszawa, Poland, phone (48 22) 826 99 55, fax (48 22) 826 37 51, 
 
 
Warsaw, 28 April 2010 
 
INFORMATION FROM THE MEETING OF THE MONETARY POLICY 
COUNCIL 
held on 27-28 April 2010 
The Council decided to keep the NBP interest rates unchanged, i.e. 
 reference rate at 3.50% on an annual basis; 
 lombard rate at 5.00% on an annual basis; 
 deposit rate at 2.00% on an annual basis; 
 rediscount rate at 3.75% on an annual basis; 
 discount rate at 4.00% on an annual basis. 
 
Further signs of recovery are appearing in the world economy, even though the scale of 
improvement in economic activity va ries across regions. In developed economies the recovery is 
proceeding at a relatively slow pace and – as e xpected in a post-recession period – is mainly 
observed in manufacturi ng. In the United States, a gradual revival in consumption demand is 
recorded alongside some signals pointing to improvement in the labour market situation. In the euro 
area, economic activity remains weak in most sectors and labour market developments are still 
unfavourable. At the same time, fast economic growth is recorded in the largest emerging 
economies. The ensuing risk of increasing economic imbalances leads to a gradual macroeconomic 
policy tightening in those countries.
 
The signs of recovery are conducive to the growth of commodity prices, including oil prices. High 
annual growth of energy prices, which also results from a low reference base, is raising the annual 
inflation rate in developed count ries, though core inflation indices remain at low levels in those 
countries. The negative consequences – mainly those related to public debt accumulation – of 
strongly expansionary macroeconomic policies, wh ich have so far supported the global economic 
recovery, are becoming more and more evident. The fiscal crisis in Greece is increasing the 
uncertainty in international financial markets. 
The data on the Polish economy in 2010 Q1 indi cate a continuing economic recovery in some 
sectors, including primarily a sign ificant rise in activ ity in industry. At the same time, 2010 Q1 
brought a strong fall in the construction and asse mbly output. After a two-month decline mainly 
related to – similarly as in the case of the construction output – unfavourable weather conditions, in 
March the growth of retail sales increased. Consumer confidence indicators are still improving 
together with enterprises’ expectations with regard to economic conditions – among others, 
expectations about demand, including forei gn demand for Polish goods. After a decline in 
investment in 2009 Q4, currently most enterprises do not envisage an increas e in their investment 
activity, though at the same time they do not redu ce their previous investment plans, which is a 
favourable development in comparison to previous quarters. A slight employment rise in the 
enterprise sector, stabilisation of the unemployment rate (adjusted for seasonal factors), an increase 
in the number of new vacancies and accelerated wage growth in March 2010 as well as enterprises’ 
 
 
 
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expectations concerning their empl oyment level and pay rises may a ll signal a gradual deceleration 
of the unfavourable labour market tendencies. 
Bank loans to enterprises continue to fall, which is primarily due to low demand for credit on the 
part of large enterprises. At the same time, the latest data point to some recovery in lending to 
households. The recovery is particularly visible in housing loans.
 
In line with expectations, in March 2010 a nnual CPI inflation decreased again (to 2.6%) 
approaching the level of the NBP inflation target of 2.5%. The inflation d ecline was largely driven 
by lower annual growth of food prices. At the same time core inflation continued to decrease. 
In line with available forecasts, in the months to come the annual CPI will still be lowered by 
negative base effects connected with the surge in the prices of excise goods and food prices in 2009. 
Other factors conducive to lower inflation include: currently low demand pressure, the hitherto 
considerable zloty appreciation and moderate growth of labour costs. In turn, inflation decline in 
2010 may be curbed by rises in commodity prices in the world markets as well as by persistently 
elevated growth of some administered prices, in cluding the prices of ener gy carriers and services 
related to house maintenance. 
On 9 April 2010, the National Bank of Poland purch ased a certain amount of foreign currencies in 
the market. This operation was consistent with the Monetary Policy Guidelines for the Year 2010. 
In the Council’s assessment the probabilities of inflation running below or above the inflation target 
in the medium term are balanced. 
An important factor affecting monetary policy is the situation of the public finance sector. 
Introducing measures aimed at permanently reducing the deficit of the gene ral government sector 
and at curbing the increase of the public debt will support macroeconomic stability and allow to 
meet the criteria for euro adoption. 
The Council maintains the opinion that Poland should join the Exchange Rate Mechanism II and the 
euro area at the earliest pos sible date, after meeting the necessary legal, economic and 
organisational conditions. 
The Council adopted the financial statement of the National Bank of Poland for the year 2009.