(Bloomberg) -- Poland extended its period of steady interest rates to 13 months after inflation edged higher and the government loosened its budget stance.
The Monetary Policy Council kept its benchmark at 5.75% on Wednesday, in line with the forecasts of all 36 economists surveyed by Bloomberg. Details of the policymakers’ decision and the central bank’s latest growth and inflation forecasts are due to be published at 4 p.m. in Warsaw.
The decision comes after a series of mixed economic data, with inflation rising to 5% last month but retail sales sliding by the most in 14 months. The policymakers also weighed the economic impact of government decisions to increase this year’s budget gap as well as Donald Trump’s apparent victory in the US presidential election.
The zloty weakened, along with other emerging-market currencies on Wednesday as Trump inched closer to claiming the White House. The Polish currency has lost 2.6% against the euro and 6.4% to the dollar since a peak on Sept. 24, the worst stint among developing peers after the Hungarian forint and Mexican peso.
Miroslaw Budzicki, a strategist at PKO Bank Polski SA, said Trump’s plans to add stimulus to the US economy may positively impact global growth, and boost inflationary pressure. This would in turn reduce the need for interest-rate cuts across the globe and “may indirectly affect the Monetary Policy Council,” he wrote.
Polish rate-setters, including the Governor Adam Glapinski, have recently signaled that rate cut discussions may start in early 2025. Glapinski is due to hold his monthly news conference on Thursday.
--With assistance from Barbara Sladkowska.
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