16:11 11 November 2024
RPP: draft budget for ‘25 does not indicate fiscal tightening
During its October meeting, the Polish Monetary Policy Council (RPP) assessed that the 2025 budget proposal did not indicate fiscal tightening that could reduce inflationary pressure. Some members argued that current interest rates are too low to sustainably return CPI to target. Concerns were raised about fiscal policy's role in medium-term inflation, with the structure of government spending being as crucial as its size. The Council maintained that inflation would return to the target after energy price increases subside, although there was uncertainty about rising energy costs. The outlook for inflation in 2025 suggests possible increases due to fiscal changes, like excise tax hikes.
