Poland's window of eurozone opportunity

The next two years will offer the best opportunity for Poland to enter the ERM-2 - the currency exchange rate mechanism that is the final step before euro adoption - according to Monetary Policy Council (RPP) member Andrzej Sławiński. "The central bank's projections show that in the next two years we will have very advantageous conditions for entering ERM-2," he told Reuters in an interview.

"Growth will be balanced and inflation will hold at a low level. There are no fears that a large current account deficit will appear [and] we have no guarantee that such advantageous conditions will remain in the future," he added.

Sławiński said that entry also hinges on budget deficit reductions promised by Law and Justice (PiS) and Civic Platform (PO), who were expected to win parliamentary elections. Both parties have promised to limit the deficit to zł.30 billion, a figure that most believe is enough to hold it below the eurozone ceiling of three percent of GDP.

However, both parties have also said they will delay any decision on joining until next year, while PiS has voiced skepticism about rapid euro adoption.

Before Poland can join the eurozone, the złoty must demonstrate stability within the ERM-2 range of plus or minus 15 percent. Civic Platform economists fear that would expose the currency to speculative attacks, and that Poland could use a fixed peg system for the złoty instead.

But Sławiński played down those fears, and said that a currency board arrangement or fixing the złoty to the euro ran the risk of fiscal inflexibility.

"If we go into ERM-2 with a balanced budget and balance of payments then speculative attacks are very unlikely," he said. "One of the risks of a currency board is a situation where inflation exceeds the targets under Maastricht, and the bank would have no influence since it would have lost the option to determine interest rates."