It is too early to talk about the possibility of lowering the interest rate. at the end of 2023, Ludwik Kotecki, a member of the Monetary Policy Council, said on Parkiet TV. Recall that on Wednesday the Council for the third time in a row left interest rates unchanged.
Borrowers took the decision of the Monetary Policy Board on Wednesday with great relief, as it means that payments on their loans will not increase for the time being. However, the really good news will be the decision to cut rates - and remember that there were 11 consecutive increases in total. Ludwik Kotecki, who belongs to the hawkish faction in the IPC, i.e., a supporter of a tighter monetary policy, believes that it is too early to talk about cuts, even in the perspective of the end of 2023.
Too early to predict interest rate cuts
“It’s still too early. I don’t think those statements should be there. It’s too early to make such statements. Today we have another 17 percent. inflation. It is still too early to speak at a time when inflation is at this level and expectations are even higher (…),” Kotecki told Parkiet TV.
A similar opinion is shared by Przemysław Litvinyuk. In an interview with Wyborcza.pl, he said that “there are strong arguments in favor of tightening monetary policy in the current environment and monitoring the psychological effects, as well as taking into account the consequences of the credit holiday.”
In his opinion, there are arguments in favor of further tightening of monetary policy and monitoring its psychological effects. “Because the effects of the changes are delayed in time, today we are seeing the first economic effects of the year-old increases,” he said.
In October, Litvinyuk backed a proposal to raise the rate by 50 basis points, which did not receive a majority of votes.
MPC did not discuss interest rates
The communiqué following the IGC meeting on Wednesday did not answer the question of whether the series of interest rate hikes could be expected to end. Adam Glapinski made it clear at Thursday’s press conference that the MPC hadn’t discussed the end of the rate hike cycle at all, adding: “If the inflationary hydra rears its head again, we will raise interest rates.”
He recalled that the IPC takes into account the current circumstances in its decisions and responds accordingly.
Source: Wprost
