Poland’s benchmark interest rate is expected to stay on hold through the rest of 2026 or potentially longer, a member of the Monetary Policy Council, Iwona Duda, told Bloomberg, citing inflation pressures that could push prices beyond the central bank’s tolerance band.
The council has maintained the reference rate at 3.75% since March amid concerns tied to conflict-driven disruptions in the Middle East. The 10-member panel is scheduled to meet next on Sept. 8-9 to review conditions.
Duda warned that inflation may surpass the central bank’s target of 2.5%, plus or minus 1 percentage point, by the end of the year. She pointed to several domestic and international drivers that elevate upside price risk, including the approaching end of government fuel price caps and a rise in fertilizer costs. Poland’s loose fiscal stance was also highlighted as a factor that increases inflationary pressure.
Outlining the council’s baseline outlook, Duda said: "The baseline scenario remains that rates will remain unchanged at least through the end of this year." She added that while there is "no immediate need for monetary tightening," the council is ready to act "in response to incoming data to prevent inflation expectations from becoming entrenched at an elevated level."
Official data show inflation accelerated to a 14-month high of 3.4% in August, a reading Duda described as "a signal that requires attention." She emphasized that supply shocks connected to the Iran conflict continue to be the principal risk to price stability and said the broader uncertainty over price trajectories demands "increased caution and vigilance" in monetary policy deliberations.
On the prospect of easing policy, Duda was explicit: "At this point, any expectations of rate cuts in the coming quarters are not justified." She said discussions about loosening monetary policy would only resume after inflation falls to the point target of 2.5% and remains there on a sustained basis.
Context and outlook
With the central bank holding its rate at 3.75% since March, council members are monitoring the interplay of expiring price controls, commodity cost trends and geopolitical supply shocks. The next meeting on Sept. 8-9 will provide the council an opportunity to reassess incoming statistics and adjust its stance if necessary.