21:23 11 March 2025
BNP Paribas economist: zloty rising due to excessive interest rate dynamics
The Polish złoty has strengthened due to excessively high interest rates compared to domestic inflation structure, argues BNP Paribas economist Wojciech Stępień. He highlights that the strong złoty does not reflect core inflation dynamics, as current inflation is driven by administrative factors. He suggests shifting focus to “underlying” inflation for appropriate rate adjustments. With real interest rates around 3%, he warns of risks to exporters and potential job losses.
The central bank could intervene but risks credibility issues. Stępień notes the złoty’s strength despite a strong dollar, complicating the economic outlook. He predicts inflation could drop below 3% later in 2024, though structural export challenges persist.
(pb.pl)
