Bank takes advantage of Kolodko's attack on NBP to turn a fast buck

Finance Minister Grzegorz Kolodko unleashed a fierce attack on the central bank and pushed back planned budget reforms by six months in a newspaper interview to be printed this week in the English-language newspaper The Warsaw Voice. Kolodko blasted the National Bank of Poland (NBP) for hurting the economy with high interest rates which attract portfolio capital and artificially strengthen the zloty. "The NBP is claiming to counteract imaginary inflationary pressures allegedly deriving from fiscal mismanagement, neglecting the fact that actual inflation, currently at under 1% per annum...was well below its target range of 2% to 4%," Kolodko said. Shortly after 5.00 p.m. the zloty tumbled, but later recovered after a London-based bank spread rumours about Kolodko's possible departure from the government allegedly because the bank wanted to sell its foreign currency at a higher price. (Reuters; Rzeczpospolita, p. B4; Puls Biznesu, pp. 10,15; Parkiet, pp. 1, 14) J.K.