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Analysis
Polish central bank calls for interest rate hikes
Consumer inflation will likely remain in the range of 2.5-4.0% for some time, but, in order to prevent it from accelerating further than that, interest rates should be raised sooner rather than later, member of the Monetary Policy Council (RPP) Halina Wasilewska-Trenkner, seen as a "hawk," said in an interview with the daily Rzeczpospolita .She reiterated that contrary to tradition, the RPP might change the rates also during its December sitting (due next Tuesday and Wednesday), even though not all new macroeconomic data will be available by that time.
Wasilewska-Trenkner also stressed that the Polish economy has an umbrella in the form of a strong zloty. However, she admitted that the worsening CA deficit - with surging imports and less buoyant rise in exports - could lead to a temporary volatility of the Polish currency, although any such turmoil would be cushioned by huge FDI and inflows of EU funds.
