National Bank of Poland Keeps Rates Steady as Expected

The National Bank of Poland left its key reference rate unchanged at 3.75% for a second consecutive meeting on May 6, 2026, in line with expectations, citing uncertainty surrounding the geopolitical outlook and its potential impact on the economy. The lombard and deposit rates were also held steady at 4.25% and 3.25%, respectively. The decision comes as inflation in Poland rose for a second consecutive month to 3.2% in April, near the 3.5% upper limit of the central bank’s target range, driven by higher energy prices amid the conflict with Iran. In March, the central bank cut borrowing costs by 25bps, just days after the war in the Middle East began, but has since shifted to a more cautious, wait-and-see stance.

The National Bank of Poland held its benchmark interest rate steady at 3.75% during its April meeting, in line with market expectations. The optimism expressed in the previous meeting regarding the conflict in the Middle East has since diminished, with inflation projections now subject to heightened uncertainty and unlikely to return to the NBP's 2.5% target before the end of next year. Headline inflation rose to 3%, its highest level in eight months, up from 2.1% in February, driven largely by a sharp increase in fuel prices, while annual wage growth in the enterprise sector remained unchanged. Economic growth is projected to slow in the first quarter of 2026, reflecting supply-side constraints, from a 4% expansion at the end of 2025. Future decisions will depend on incoming information regarding inflation and economic activity, as the NBP warns of rising global commodity prices, fiscal policy and regulation concerning fuel prices and developments in wage growth.

The National Bank of Poland lowered its benchmark interest rate by 25bps to 3.75% at its March meeting, its first rate cut of the year and aligning with market expectations, while signaling that future decisions will depend on upcoming developments. The move brings the policy rate to its lowest level since March 2022. Despite growing concerns over the Middle East conflict, which has driven up global oil and natural gas prices, the central bank pointed to improved March inflation projections. Annual headline inflation fell to 2.2% in January and has remained within the bank’s target range of 1.5–3.5% since July 2025. Still, the NBP flagged upside risks to the inflation outlook, with expansionary fiscal policy, strong demand, and robust wage growth adding to the increase in energy prices. Poland’s economy continued to expand steadily throughout 2025. GDP grew by 4% year-on-year in the fourth quarter, marking the strongest pace of growth since the third quarter of 2022.