The National Bank of Poland approved the interest rate of 4.5%
The National Bank of Poland has once again revised the interest rate. Now it is 4.5%, which is a record value for 10 years. It should be noted that this increase was the seventh in a row, the regulator raised the rate at once by 1%.
The Central Bank notes that this increase will primarily affect mortgage borrowers. For example, if they have a credit of 300 thousand zlotys, and the remaining period of payment is 30 years, then the monthly payment will increase by about 200 zlotys.
The reason for raising the interest rate the Polish regulator says is the desire to slow the rate of inflation. At the end of last year, it stood at 10.9 percent, the highest in more than 20 years. Last month, inflation was already 13.9%.
The first interest rate hike took place in October 2021, and it is likely that the new review will not be the last, given the economic situation in the country and the world at large.
The increase in the rate has a painful effect on the welfare of Poland’s population, which during the years of economic stability has become accustomed to a high standard of living and virtually no unemployment. A number of experts note that inflation will continue to rise, as it has a global nature. Its increase is observed not only in the European Union, but also in the United States, Britain, and other countries, and therefore eliminating it at the local level is not yet possible. At the same time, an increase in interest rates may slow down the process of inflation growth, but not significantly.
Given such trends, analysts at Credit Agricole Bank presented their forecast for the Polish market. According to their report, the cost of products for the current year will increase by about 15%. For comparison, in 2021 the figure was 3.2%. The maximum growth will occur in the last quarter of 2022, and it is possible that the increase in price will be at 19%.
From February to July an anti-inflationary shield was in effect in Poland, which reduced the amount of VAT on a number of food products, fertilizers, fuel, and gas. It brought its results but did not solve the problem completely. Food prices in the country increased by 12.7% over the year, and global trends suggest that the upward trend will continue.
According to statistics, Poland has not seen such a dramatic increase in the food group of goods since the 1990s. In just a month, the price of meat increased by 10%, and poultry, butter, bread, and sugar went up significantly. At the same time, experts say that no decrease should be expected in the near future.
