Central bank raises interest rates by 50 bp, less than expected

The Monetary Policy Council raised interest rates in Poland by 50 basis points for the tenth time in a row at its meeting in July. Most analysts forecasted an increase of 75 basis points. After an increase, the interest rate is set at 6.5%.

After the move, złoty fell sharply to PLN 4.8 against the euro but later slightly recovered. ING economists estimated that a smaller scale of tightening, chosen by the…