NBP MPC Press Release - 2010-01-26
Central bank: nbp | Type: decision | Date: 2010-01-26

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, 26 January 2010 
 
INFORMATION FROM THE MEETING OF THE MONETARY POLICY 
COUNCIL 
held on 25-26 January 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. 
 
Released data point to a further growth in economic activity in the United States and a slightly 
weaker improvement in economic conditions in th e euro area as compared to the US economy. 
However, situation in the labour market in the developed economies remains unfavourable and their 
lending continues to shrink. At the same time, GD P growth is accelerating in the largest emerging 
economies, including China, where the risk conn ected with excessive le nding and asset prices 
growth has also recently increas ed. The recovery in economic activity around the world is still 
being supported by highly expansive macroecono mic policy based on both conventional and non-
standard instruments. 
Over the recent period the pri ces of financial assets in de veloped economies have remained 
relatively stable, while oil prices have displayed considerable volatility. Those economies have seen 
a rise in headline inflation, which was mainly the result of higher annual growth of energy prices. 
The latest data on the Polish economy indicate an improvement in economic activity. Despite 
increase in the unemployment rate, relative stabilisation of employment in the enterprise sector may 
signal a gradual deceleration of the unfavourab le labour market tendencies. Lending to the 
enterprise sector is still shri nking and the growth in loans to the household sector remains 
considerably lower than in the past few years. 
In December 2009 the annual CPI rose to 3.5%, thus equalled to the upper limit for deviations from 
the inflation target of 2.5%. Rise in the annual inflation rate was primarily supported by the positive 
base effect connected with a strong decline in fu el prices in December 2008. At the same time, core 
inflation net of food and energy prices decreased s lightly to 2.6%, which was mainly related to the 
slowing growth of services prices. 
In the Council’s assessment, in the months to come inflation will be lowered by negative base 
effects connected with the surge in administered prices and food prices at the beginning of 2009. 
Other factors conducive to lowe r inflation include: low demand pressure, previously observed 
moderate growth of labour costs an d the previous zloty appreciation. In turn, inflation decline in 
2010 may be curbed by rises in: co mmodity prices in the world ma rkets, fees s ubject to local 
governments’ decisions, excise duty, and administered prices.
 
 
 
 
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The Council assesses the probabilities of inflation running below or a bove the inflation target in the 
medium term to be balanced. In the Council’s view, the improvement in global economic activity 
and the previously implemented monetary policy easing support the return of the economy to the 
potential growth path. The impact of expansi onary macroeconomic policies abroad and their 
prospective reversal on the future global economic growth and infl ation constitute a significant 
source of uncertainty for domestic monetary policy. 
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 
would support maintaining macroeconomic stability and allow to meet criteria for euro adoption. 
 
The Council maintains its view that Poland should join the Exchange Rate Mechanism II and the 
euro area at the earliest pos sible date, after achieving the necessary political support for 
amendments to the Constitution of the Republic of Poland and other legal acts required for euro 
adoption in Poland. 
The Council approved The Balance of Payments of the Republic of Poland in 2009 Q3.