MNI NBP Preview - Apr 2025: Harder To Put On Hawkish Act

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Executive Summary:

• Unanimous consensus calls for another on-hold rate decision.
• Steady stream of dovish signals is a challenge to the Governor's hawkish stance.
• We see a vote on a motion to cut rates as a low-probability dovish risk scenario.

The National Bank of Poland (NBP) is expected to extend the period of interest-rate stabilisation, defying a steady flow of dovish signals from the economy. Although headline inflation has plateaued out below the expected values in 1Q2025 and wage growth cooled more than anticipated, the NBP’s macroeconomic projection rests upon controversial assumptions on energy prices, which imply a rebound in inflation later in the year. The focus will be on the way in which the panel and the Governor handle the recent dovish signals in official communications. At this point, we do not rule out a scenario in which one of the members would table a motion to cut rates, although most members are unlikely to rally behind as any such initiative. Looking further afield, we expect the central bank to start lowering rates from July.