Warsaw: Poland could decide whether it must cut interest rates based on the economy’s performance in the third quarter amid signs of a slowdown, a member of the central bank’s Monetary Policy Council (MPC) told broadcaster TVN CNBC on Friday.
Poland has been the only European Union member state to avoid recession since the global financial crisis in 2008 thanks to a multi-billion euro infrastructure investment programme, an internal market of 38 million people, and a flexible currency.
Poland’s economy expanded by 4.3 per cent in 2011, one of the fastest rates in the EU, but growth is expected to weaken to about 2.5 per cent this year and to 2.0 per cent in 2013 even as fiscal and monetary policy remain tight.
“The situation has changed enough for me to be less of an opponent [of cutting rates],” Jan Winiecki, an influential MPC member, said.
“If I see that growth in the third quarter is low ... I will vote accordingly. But we have yet to see this piece of data.”
Winiecki said the economic situation remained uncertain and that growth could slow to 2 per cent or even fall to close to zero. Poland is likely to release its third-quarter gross domestic product (GDP) data next month.
Widely seen as a hawkish member of the ten-strong MPC, Winiecki has so far been cool on the idea of cutting borrowing costs because of persistently high inflation. He even backed a rate hike of 25 basis points to 4.75 per cent in May.
