Belka suggests budget draft approval offers chance for interest rate cut

Finance Minister Marek Belka yesterday forecast that inflation at the end of this year would be significantly lower than the 4% recorded in October. "The finance ministry estimates that inflation in December could fall to 3.6% to 3.7%," Belka told reporters. On interest rates he said that passage of the government's 2002 budget draft by parliament would justify another cut, but stopped short of demanding a reduction of borrowing costs this month. "There is a budget plan that must be approved by parliament...(Its passage) would be a good moment for the next rate cut," Belka said. Asked if he expected a rate cut this month, as was demanded by Prime Minister Leszek Miller this week, Belka said, "I am hopeful but I am also a realist." (Reuters)