NBP MPC Press Release - 2014-05-07
Central bank: nbp | Type: decision | Date: 2014-05-07

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Warsaw, 7 May 2014 
 
 
Information from the meeting of the Monetary Policy 
Council held on 6-7 May 2014 
 
The Council decided to keep NBP interest rates unchanged: 
 reference rate at 2.50% on an annual basis; 
 lombard rate at 4.00% on an annual basis; 
 deposit rate at 1.00% on an annual basis; 
 bill rediscount rate at 2.75% on an annual basis. 
 
Growth in global economic activity remains moderate, although the economic 
situation varies across countries. In the United States, GDP growth slowed down in 2014 
Q1, yet recent data have indicated an improvement in business conditions in the 
subsequent months. At the same time, recovery in t he euro area continues, albeit at a 
moderate pace. In the largest emerging market economies, activity growth remains slow 
relative to previous performance , including China, where it weakened in 2014 Q1. 
Moderate growth in global economic activity is conducive to maintaining low inflation 
in many countries. 
Data on domestic economic activity confirm a continuation of the gradual recovery in 
Poland. In March, industrial output and retail sales continued to rise, yet slower than 
expected. At the same time, construction and assembly output picked up. Business 
climate in dicators – despite some weakening in March – still point to further activity 
growth in the coming quarters. Gradual acceleration in economic activity is accompanied 
by moderate lending growth, both to firms and households. 
The recovery is gradually trans lating into improvement of labour market conditions. 
Employment in the enterprise sector is slowly rising, and unemployment is gradually 
falling. However, the unemployment rate is still elevated, which restricts wage pressure 
in the economy. 
In March, CPI in flation amounted to 0.7%, thus re maining markedly below the NBP 
inflation target of 2.5%. Core inflation also remained low, and producer prices continued 
to fall. This was accompanied by low inflation expectations. 
In the opinion of the Council, gradual economic recovery is likely to continue in the 
coming quarters, however, inflationary pressures will remain subdued. Therefore, the 
Council decided to keep NBP interest rates unchanged. The Council maintains its 
assessment that NBP interest rates should be kept unchanged for a longer period of time, 
i.e. at least until the end of the third quarter of 2014. 
In the opinion of the Council, lowering interest rates in the first half of 2013 and 
keeping them unchanged in subsequent quarters supports the recovery of the domestic 
 
 
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economy, a gradual return of inflation to the target and a stabilisation in the financial 
markets.