Henryk Wnorowski of the Monetary Policy Council (RPP) admits that he is considering an interest rate hike in November. In his view, even lower inflation in October will not end the discussion on tightening monetary policy.
Wnorowski’s comments, quoted by Bankier.pl on Monday, 12 October, come after the October RPP meeting, at which rates were left unchanged. The NBP reference rate stands at 3.75%. The council member pointed out that the argument for a hike was the September CPI inflation reading of 4.0%, clearly above the upper limit of the NBP’s deviation band around the target (2.5% +/- 1 percentage point).
What Wnorowski said
According to these reports, the council member believes that the restrictiveness of monetary policy in the context of September inflation has clearly decreased. He announced that he will watch whether the fuel price reduction programme proves effective and whether CPI returns to the deviation band in October. He added, however, that a return to the band alone does not mean a hike will not be considered. In his view, the current situation calls for "greater principledness" on the part of the Council.
Wnorowski also pointed to the risk of inflation expectations becoming unanchored and to a weakening of the zloty. However, he sees no justification for the scale of hikes that markets are pricing in: roughly 100 basis points over the year.
NBP projection key
The November inflation projection from the NBP may be decisive. According to Wnorowski, it will show the extent to which pricier fuel and so-called second-round effects will feed into consumer prices. NBP President Adam Glapiński said at the October press conference that the RPP is ready to hike as early as November if the projection shows worrying and growing inflationary signals. However, he does not currentlyforecast one himself, according to Bankier.pl.
Inflation rose to 4.0% year on year in September. ING BSK economists link this mainly to fuel prices, which rose 9.2% month on month. Since the beginning of September, the 23% VAT rate on fuel has been restored, having previously been cut to 8% (according to an ING comment cited by Stockwatch.pl).
Differing views and forecasts
Views within the Council are not uniform. Ludwik Kotecki allows for one or two 25 bp hikes at the end of 2026 or in early 2027 if the projection shows inflation remaining above 4% for longer. Pekao economist Piotr Bartkiewicz expects a hike in November, while ING BSK expects one only in early 2027, of 50 bp. Analysts cited by FXMAG also see a risk that a November hike will not materialise.
What it means for borrowers
A hike in the reference rate would raise repayments on variable-rate loans, including mortgages. No decision has been taken and it depends on the November projection and inflation data, including the October CPI reading. For a loan priced on WIBOR, the first effects of an RPP move would only be visible at the next rate adjustment under the contract. At present, no decision to change rates has been made, and Wnorowski himself speaks of a smaller move than markets are pricing in.
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