NBP Post-Policy Statement: Rate cut should be seen as an adjustment and future decisions hinge on data, may intervene in the FX market
Newsquawk Staff ·
- The outlook for global activity and inflation is subject to uncertainty, related, in particular, to geopolitical situation.
- The annual GDP growth was positively affected by an increase in domestic demand, including consumption and investment.
- Annual wage growth in the enterprise sector in January 2026 was markedly lower than in the previous month.
Inflation
- 2026 --> 2.25% (prev. 2.95%)
- 2027 --> 2.4% (prev. 2.6%)
- 2028 --> 2.55%
GDP
- 2026 --> 3.9% (prev. 3.65%)
- 2027 --> 2.9% (prev. 2.6%)
- 2028 --> 2.95%
What it means
The NBP's post-policy statement indicates a rate cut should be interpreted as an adjustment rather than a policy shift, emphasizing that future decisions will depend on incoming data. This guidance, along with a potential for FX market intervention, suggests the central bank is looking to support economic conditions amid geopolitical uncertainties, with lowered inflation projections implying a more cautious approach to monetary policy going forward.
Sources
- RBI is said to be likely selling dollars through state-run banks to limit a rupee weakness
- Taiwan Central Bank Governor affirms Taiwan has the capacity to establish a sovereign wealth fund and says says relative weakness of the Taiwanese dollar this year is due to foreign investors taking profits on Taiwan stocks
- Chile Central Bank maintains benchmark interest rate at 4.50% as expected, with the decision unanimous, while it stated that the future path of interest rates will be assessed on a meeting-by-meeting basis
- BCB Governor Galipolo says the BCB only intervenes in the foreign exchange market when it identifies market dysfunction
- BCB's Picchetti says economic activity is showing a very clear slowdown, concentrated in cyclical sectors
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