Polish rate hawk sets sights on single hike

Bloomberg

The most hawkish member of Poland’s Monetary Policy Council said a single interest-rate increase is needed to ward off the rising threat of inflation.
Central banker Kamil Zube-lewicz said that such tightening wouldn’t harm economy but ev-en he holds out little hope that the 10-member policy panel — which has kept the benchmark unchanged for seven years — will back this view.
Unlike its east European peers in the Czech Republic and Hungary, the National Bank of Poland has avoided tightening policy and prospects for higher rates remain dim as the outlook for euro-region growth slows.
“All we need is one hike,” Zubelewicz said in an interview. “It would be safe for economic growth, while helping erase the risk of excessive inflation.”
Inflation quickened by 1.5 percentage points over the last four months, accelerating to a two-year high and topping analysts’ expectations. Nevertheless, central bank Governor Adam Glapinski has maintained his view that record-low official borrowing costs should be extended into 2022, when a majority on the 10-member rate-setting panel end their terms.
Half a year ago, Zubelewicz was the author and sole supporter of the first rate-rise motion put forward to the MPC since 2012.
Price growth is occurring slower than he expected when he proposed the hike, but “what’s worse, it’s happening due to local factors.”