Poland's rate setters are keeping a finger on the trigger in case inflation proves too sticky. Kotecki said the Council may consider raising rates before year‑end or in the opening months of next year if the upcoming projection indicates inflation sticking above 4% for an extended spell. As he told Bloomberg, "If the projection shows that inflation will likely remain consistently above 4%, the Council will have to consider rate hikes later this year or early next year - one or two 25 basis point increases." He added, "This is a conditional scenario: it is triggered only by inflation sustainably topping 4%." For October, he expects no move, citing unpredictable forces abroad, such as the conflict in the Middle East. He said the discussion will likely reignite after November's inflation projection.
This week the National Bank of Poland held its key rate at 3.75% for the sixth consecutive meeting. On Thursday, Governor Adam Glapinski said he expects no change in rates through roughly the middle of next year. In derivatives markets, pricing implies three quarter‑point increases over the next 12 months.
Inflation rose to 3.4% in August, the strongest reading in 14 months and close to the upper edge of the bank's 2.5% target band of plus or minus 1 percentage point. The increase has been driven by energy costs, with the Iran conflict clouding global supply outlooks. Kotecki said inflation could still cool without tightening if oil and gas prices ease.
He also pointed to softer consumption and an expected slowdown in growth to around 3% next year, compared with 3.7% to 3.9% in 2026, as forces that could take pressure off prices. Or as he put it, "The sequence is clear: first, stabilizing rates at their current level, then - under certain conditions - a possible rate hike. Rate cuts are out of the question for now."
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If inflation stays sticky and the Council opts for one or two small moves, variable‑rate loans could edge higher. If energy prices and demand cool instead, the hold could last longer, in line with the governor's guidance. Either way, the November projection is the milepost to watch for how long today's plateau lasts and whether a small step up is on the table.
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