Poland Holds Rate as Expected

The National Bank of Poland kept its main interest rate unchanged at 4% in February, as expected, extending a pause for a second month as policymakers wait for new macroeconomic forecasts before considering further easing. The decision matched market expectations, though views were split, with some analysts expecting a 25 basis point cut. Officials cited the lack of fresh inflation data and limited new information since the previous meeting. A new inflation projection will be published in March, allowing a clearer assessment of whether the recent disinflation trend is sustainable. Inflation slowed to 2.4% in December, near the midpoint of the central bank’s 1.5% to 3.5% target range, while final inflation figures for January and February will also be released in March following changes to the statistical basket.

The National Bank of Poland held its benchmark interest rate at 4% at its first meeting of 2026, pausing the cumulative 175 basis points of rate cuts implemented in six steps last year. Annual inflation eased to 2.4% in December 2025, its lowest level since April 2024, slightly below the NBP’s 2.5% ±1 percentage point target range. However, the central bank noted that it remains to be seen whether the decline in inflation is sustainable over the longer term. Incoming data suggest that Poland’s GDP growth in Q4 2025 likely remained close to Q3 levels, despite a slowdown in retail sales, industrial output, and construction. Labour market indicators pointed to slower wage growth and a decline in enterprise-sector employment. Against this backdrop, the Monetary Policy Council kept NBP interest rates unchanged, noting that future policy adjustments will depend on incoming data on inflation and economic activity.

The National Bank of Poland cut its benchmark rate by 25 basis points to 4.00% at its December 2–3 meeting, hitting the lowest level since March 2022. This was the sixth rate cut of the year, bringing total easing in 2025 to 175 basis points. The move came after annual inflation unexpectedly slowed to 2.4% in November, below market expectations, and remained within the central bank’s 2.5% ±1 percentage point target for the fifth consecutive month. Poland’s GDP rose 3.8% year-on-year in Q3, up from 3.3% in Q2, supported by stronger domestic demand, particularly consumption and investment. Wage growth in the corporate sector slowed to 6.6% in October, below forecasts, while employment continued to decline. Against this backdrop, and amid global economic and inflation uncertainties, the Monetary Policy Council judged that a rate cut was warranted to bolster economic activity and preserve price stability.