The last months were a period of rampant inflation in Poland. Therefore, the Monetary Policy Council (MPC) decided to raise interest rates. This made more and more people stare at them. It seems that people with loans are the most interested in this topic.
- The coronavirus pandemic has caused many central banks in Europe to cut interest rates
- In Poland, interest rates will likely be raised again on December 8
- “NBP interest rates will be adjusted in such a way as to prevent continued high inflation” – recently announced by NBP President, Adam Glapinski
- More such stories can be found on the homepage of Onet.pl
What is the interest rate?
In the simplest translation, it is the cost of capital (interest), i.e. the price that the owner of capital will receive from the entity using its capital during a specified period of time.
Simon Sochisky, attorney and partner at Orlik & Partners, explains.
See also: Interest rates will reach 3%? Goldman Sachs expects rapid increases in Poland
Corona virus cut interest rates
In Poland, the level of interest rates is determined by the Monetary Policy Board. The Monetary Policy Committee is the decision-making body National Bank of PolandHis task is to develop hypotheses and implement the monetary policy of the state. The coronavirus pandemic has done so much central banks Lowered interest rates in Europe. In some countries, they turned negative. In Poland, until October of this year, interest rates remained at a record low.
Effects of cuts and increases in interest rates
The reduction in interest rates translates into a decrease in WIBOR rates, and this is in the amount of the mortgage premium. The effect is an incentive for entrepreneurs and natural persons to borrow, which allows to increase economic activity, lowering interest rates on deposits.
— Explains attorney Suchcicki.
The increases in interest rates observed since October of this year contribute to an increase in the effective annual interest rate on loans and advances, which in turn translates into higher and higher monthly payments. On the other hand, rates of rise are also related to Increased interest rates on bank deposits and opportunity to slow inflation.
See also: The sixth increase in interest rates in Hungary
Another rate hike soon
December 8, 2021 is the day of the next MPC meeting, when it will likely raise interest rates again.
If necessary, interest rates and other elements of monetary policy will be changed; NBP interest rates will be adjusted in a way that prevents continued high inflation
– Adam Glapinski, president of the NBP, announced recently, citing PAP.
However, in late July 2021, Adam Glapinski noted that inflation had increased largely due to external and temporary factors, Which, in his opinion, translated into a lack of places to change interest rates.
NBP inflation forecast is wrong
In July, analysts of the Polish National Bank expected inflation to rise, but only to a level in the range of 4.6-4.7 percent. In the second and third quarter of this year. Now the situation has changed dramatically. In November, economists say we will break the 7 percent barrier. Even the latest NBP projection does not provide that.
In the so-called central forecast analysts for NBP forecast 4.9% inflation. In 2021 5.8 percent in 2022 and 3.6 percent. in 2023 In July, expectations were lower by 0.8, 2.5 and 0.2, respectively.
Echo Richards embodies a personality that is a delightful contradiction: a humble musicaholic who never brags about her expansive knowledge of both classic and contemporary tunes. Infuriatingly modest, one would never know from a mere conversation how deeply entrenched she is in the world of music. This passion seamlessly translates into her problem-solving skills, with Echo often drawing inspiration from melodies and rhythms. A voracious reader, she dives deep into literature, using stories to influence her own hardcore writing. Her spirited advocacy for alcohol isn’t about mere indulgence, but about celebrating life’s poignant moments.
![We will try on clothes with a smartphone. Zalando’s regional chief reveals the plans [WYWIAD]](data:image/svg+xml,%3Csvg%20xmlns='http://www.w3.org/2000/svg'%20viewBox='0%200%200%200'%3E%3C/svg%3E "We will try on clothes with a smartphone. Zalando’s regional chief reveals the plans [WYWIAD]")
