Rates have risen in real terms and only speculators will leave
Janusz Jankowiak, chief economist, BRE Bank
"The first of the rate cuts will not have a significant influence on the actual economy. Fifty basis points will not catch up to the forecasted inflation decrease and this means a raise of rates, not a fall, in real terms. Only a cumulative 125-150 points could have a positive effect on domestic demand. The cut will affect, however, the financial markets.
"It is the speculative capital that flows out of Poland. For stable investors, Poland will remain attractive, despite rate cuts [here] and rate raises in the US and the eurozone. [That is because] the spread on market rates between Poland and the US will still reach 60-80 base points or even 190-200 points against eurozone values. Poland will remain a country of inflow, not outflow of capital.
"The macro-economic base justifies the currency rate at zł.3.90-4.20 for EUR 1. The previous złoty levels were possible only because of a large stream of hedge-fund assets, which located only in bond markets around zł.900 million net weekly in the beginning of this year."
"The first of the rate cuts will not have a significant influence on the actual economy. Fifty basis points will not catch up to the forecasted inflation decrease and this means a raise of rates, not a fall, in real terms. Only a cumulative 125-150 points could have a positive effect on domestic demand. The cut will affect, however, the financial markets.
"It is the speculative capital that flows out of Poland. For stable investors, Poland will remain attractive, despite rate cuts [here] and rate raises in the US and the eurozone. [That is because] the spread on market rates between Poland and the US will still reach 60-80 base points or even 190-200 points against eurozone values. Poland will remain a country of inflow, not outflow of capital.
"The macro-economic base justifies the currency rate at zł.3.90-4.20 for EUR 1. The previous złoty levels were possible only because of a large stream of hedge-fund assets, which located only in bond markets around zł.900 million net weekly in the beginning of this year."
