“Economists predict that by the end of 2024, inflation will reach 5.5% compared to the year. This means that it will be about 1 percentage point less than in December of last year. However, among the pessimists there are forecasts indicating that we may see higher price dynamics at the end of this year. mBank analysts believe that inflation may exceed 8% in December. Kamil Sobolewski, Chief Economist of Employers of Poland, predicts that It will be 7.5%. – we read in the article.
Experts expect inflation to fall steadily below the central bank's target (2.5% +/-1 percentage point) in 2026, although some analysts believe this could happen in the second half of 2025.
Economists note that the main element that complicates inflation forecasting is the unknown government approach to VAT on food or protective measures to protect against rising electricity, natural gas or central heating prices, which are also indicated in the material.
What will the National Bank of Poland do?
“Today the key interest rate is 5.75 percent, but in the last two months there is no desire to reduce the cost of money further.” NBP President Adam Glapinski said that there is too much uncertainty regarding the freezing of energy prices, VAT on food. Or what the new government's fiscal policy will be, so the Monetary Policy Council should monitor the situation and refrain from any actions. However, economists interviewed by Business Insider Polska are confident that the central bank will return to easing monetary policy. this year, and the main rate of NBP will be reduced to 5.25 percent at the end of 2024 – read further.
According to most analysts, the Monetary Policy Council (MPC) will not make a decision on tapering in the first half of the year, but after the holidays.
Monetary Policy Council (MPC) member Cesari Kochalski said in an interview with ISBnews in November that the stabilization of interest rates during 2024 is a possible scenario – “I will not allow interest rates to change over the next year and leave a reference.” The rate is 5.75 percent, the answer to that question is yes, although that doesn't mean I'm saying it will definitely happen, it will probably depend on incoming information about the inflation outlook and economic activity. In his estimation, the demand side will come to the fore in 2024, the main thing is what will be finally implemented in the fiscal policy after the parliamentary elections, its shape will clearly affect the demand side and replace the weakening of the supply – which has been so far. was of primary importance.
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