Annual inflation rate comes down to 6.2% following June fall in prices

According to the latest Central Statistical Office (GUS) figures, prices fell in June by 0.1%, bringing the annual inflation rate down to 6.2%. Analysts expressed some surprise at the GUS announcement, since they had expected a slowing of price rises, or even a halt, but not a fall. However, they do not believe that the fall will encourage the Monetary Policy Council (RPP) to cut interest rates. Bank Handlowy economist Katarzyna Zajdel-Kurowska is quoted by Reuters as saying, “This figure could encourage rate cuts, but budget problems are now the top issue.” Meanwhile, RPP member Dariusz Rosati claimed the inflation data vindicated the last rate cut, saying, “The data confirms the RPP was right about its rate decision.” Analysts say they expect inflation to dip over the next few months. Juliet Sampson from Bank of America in London, said, “I expect the CPI to fall below 6% by year end. I see it falling below that to about 5% in September and October.” (Gazeta Wyborcza, p. 13; Reuters) M.T.