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Polish c.banker Litwiniuk: total of 100-125 bps of cuts possible this year
Published by Global Banking & Finance Review®
Posted on June 6, 2025
3 min readLast updated: January 23, 2026
Global Banking & Finance Review®
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Published by Global Banking & Finance Review®
Posted on June 6, 2025
3 min readLast updated: January 23, 2026
Polish central banker Litwiniuk indicates potential rate cuts of 100-125 basis points in 2023, with discussions possible in July or September.
WARSAW (Reuters) -Poland's Monetary Policy Council could return to discussions about rate cuts in July or September, central banker Przemyslaw Litwiniuk told TOK FM on Friday, adding that there may still be a total of 100-125 basis points of cuts this year.
However, he said that due to certain risks regarding the path of disinflation the MPC needs to be cautious.
The central bank left its main interest rate unchanged at 5.25% on Wednesday, as expected, saying that the current level was conducive to achieving its inflation target.
"A different decision could suggest that we are in a cycle of cuts. However, due to certain risks that accompanied the formation of the disinflation path, we should approach this issue with caution," Litwiniuk said.
"This does not mean that the Council will not return in July or September to the decision to lower interest rates."
Among the uncertainty factors, Litwiniuk mentioned wage dynamics, which remain high and pose a "significant risk" to price stability. He also mentioned the development of energy prices at the end of this year and the risks associated with the government's loose fiscal policy.
"I believe that the scenario of cutting interest rates in 2025 by a total of 100-125 basis points remains valid, but its hasty implementation could create risks at the end of the impact horizon, i.e. next year, when we would like to see inflation at the (inflation) target," the MPC member said.
In May, the National Bank of Poland cut its benchmark rate by 50 basis points, in its first monetary easing since October 2023.
Inflation slowed down to 4.1% in May, but remained outside of the central bank's inflation target range between 1.5% and 3.5%.
The Governor of the National Bank of Poland (NBP) Adam Glapinski said on Thursday that the bank will not commit to a future path for interest rates for now because of economic uncertainty.
Ludwik Kotecki, another member of the Monetary Policy Council, told Bloomberg that he still supports cutting rates in July or September and that a total of 50 basis points of additional easing this year would be "optimal".
However, he added that he was not sure whether the MPC would find a majority to support such a scenario, and that central bankers were more cautious due to growing political instability and concern over a bloated budget.
(Reporting by Alan Charlish, Pawel Florkiewicz; Editing by Toby Chopra)
Przemyslaw Litwiniuk indicated that the Monetary Policy Council could discuss rate cuts in July or September, suggesting a total of 100-125 basis points of cuts might be possible this year.
The National Bank of Poland left its main interest rate unchanged at 5.25%, stating that this level is conducive to achieving its inflation target.
Litwiniuk highlighted risks related to wage dynamics and energy prices, which could impact price stability and the disinflation path.
The National Bank of Poland cut its benchmark rate by 50 basis points in May, marking its first monetary easing since October 2023.
Adam Glapinski stated that the bank will not commit to a future path for interest rates due to ongoing economic uncertainty.
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