Poland will not fall into recession says central bank head

2022-12-08 16:11 update: 2022-12-11, 15:21
Fot. PAP/Radek Pietruszka
Fot. PAP/Radek Pietruszka
Poland's central bank, the National Bank of Poland (NBP), does not predict a recession in the country, but economic growth may fall to zero, the central bank governor has said.

At his monthly press conference on Thursday following an interest rate decision a day before, Adam Glapinski said that despite weakening sentiment, Poland should not see a recession.

"We're not predicting a recession in Poland but it may happen that we will go down to GDP growth rate around zero," Glapinski said. "In our projections we're forecasting that it will be at least 0.7 percent, but there are many factors involved."

Glapinski also predicted that Poland's consumer price index, the CPI, will continue to go up in January and February but will start falling from March or April.

"We're predicting there will be a rise in January and February, but we're expecting that by the end of the first quarter, by March or April, inflation will start falling consistently and fast," the governor said. "It will be a permanent process."

By the end of next year, inflation should fall to the single-digit area, according to Glapinski.

"All projections, including the significant international ones from international institutions, show that by the end of next year we will be down to single-digit inflation between six and nine percent," Glapinski said, but made a reservation that this will happen provided that "other circumstances do not change."

On Wednesday, the NBP's rate-setting body, the Monetary Policy Council (RPP), kept interest rates unchanged for the third month in a row, leaving the main interest rate at 6.75 percent, far below November's 17.4 percent CPI figure.

Explaining its decision, the RPP said that Poland's inflation will probably go down as a result of the restrictive policies of the world's major central banks, which will help curb inflation and commodity prices across the globe. Poland is expected to experience weaker growth next year which, will also ease inflation pressures, the RPP said. (PAP)