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September 20, 2020
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NBP: there is still room for further easing |

If anyone had thought so far that our central bank would stop at the level of monetary policy we currently have, it is wrong. “NBP still has room to ease monetary policy” – wrote the president of this institution, Adam Glapiński, in an article for Dziennik Gazeta Prawna.

Adam Glapiński: This is not the end of monetary easing

Glapiński is of the opinion that the NBP still has a lot of room to show off, if the economy still does not turn out to be straight.

“(…) However, if the reality negatively verified our hopes, the NBP still has space for further anti-crisis measures, including further loosening of monetary policy.”

– he wrote in an article published in the journal.

Despite such announcements, Glapiński believes that inflation will decline in the coming quarters.

“Currently, inflation is in line with the NBP’s inflation target, although it is slightly above 2.5%. however, we expect it to decrease in the coming quarters “

– forecasts.

“The fact that inflation in Poland is currently not as low as in many EU countries is partly related to a relatively faster recovery in demand”

– added.

The target is a weak zloty

What may worry people buying goods from other countries and the euro area, the head of the NBP added that he himself believes that the weakening of the Polish zloty could be beneficial for the economy.

“A factor that could provide additional support for the economy and limit the risk of deflation would be a stronger adjustment of the zloty exchange rate in response to the global shock caused by the pandemic and the loosening of the NBP monetary policy. (…) It can be assessed that in the current conditions a weaker exchange rate could contribute to a slightly faster pace of economic recovery “

– he wrote.

Inflation in Poland

So you get the impression that the Polish central bank is following in the footsteps of the Fed. The US policy of weakening the dollar is also continued. But in the case of the United States we are dealing with an incomparably stronger economy and a petro-dollar. In other words, a great power can afford to reprint it, because the dollar will always find buyers.

In terms of PLN, things are not that good anymore. In Poland, the government tries to stimulate the economy by lowering the currency exchange rate. The question is whether such activities will not get out of hand …

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