POLAND: MNI NBP Review - July 2025: Inflation Forecast Triggers Cut
Download Full Report Here
Executive Summary
- The NBP delivered a surprise 25bp ‘cautious rate adjustment’ on a lower inflation forecast.
- Governor Glapiński signalled that there was potentially plenty of room for further easing.
- The Governor outlined four key risks to the inflation outlook that the MPC keeps an eye on.
The National Bank of Poland (NBP) wrong-footed the market by delivering a 25bp ‘cautious adjustment’ to its interest rates, bringing the reference rate to 5.00%. While dovish revisions to the triannual macroeconomic projection were widely anticipated, and it has become a common perception that the central bank could easily build a case for further monetary easing, recent communications persuaded most NBP watchers that the Council would rather wait until the end of summer before recommencing interest-rate cuts. On the contrary, a more benign inflation outlook was used to justify another rate adjustment, while the Governor guided that if the current baseline scenario materialises in data from the real economy, the central bank could ultimately bring the reference rate to the vicinity of the inflation target, potentially as low as to 3%.
Want to read more?
Find more articles and bullets on these widgets:
Historical bullets
EGB SYNDICATION: Italy Dual-Tranche New 5y / 10y Green Tap: Final Terms
- Size: E12bln (MNI expected E7-10bln)
- Books closed in excess of E120bln (incl. E5.3bln JLM interest)
- Spread set earlier at 2.95% Jul-30 +8bps (guidance was +10bps area)
- Maturity: 1 October 2030
- Coupon: Short first
- ISIN: IT0005654642
- Size: E5bln WNG
- Guidance: 0.95% Mar-37 +6bps (guidance was +9bps area)
- Books closed in excess of E94bln (incl. E3.8bln JLM interest)
- ISIN: IT0005596470
- Settlement: 11 June 2025 (T+5)
- Bookrunners: Barclays (DM/B&D) / BNPP / BofA / CACIB / Santander / Societe Generale
- Timing: Allocations and pricing to follow
US 10YR FUTURE TECHS: (U5) Testing Resistance
- RES 4: 112-04+ High May 2
- RES 3: 111-25 High May 7
- RES 2: 111-05+ High May 9
- RES 1: 110-30 High May 30 and high Jun 2
- PRICE: 110-14 @ 11:20 BST Jun 4
- SUP 1: 109-26/12+ Low May 29 / 22 and the bear trigger
- SUP 2: 109-09+ Low Apr 11 and key support
- SUP 3: 109-00 Round number support
- SUP 4: 108-25+ 0.764 proj of the Apr 7 - 11 - May 1 price swing
Treasury futures are holding on to the bulk of their recent gains. A dominant bear cycle remains in play for now, and recent gains still appear corrective. However, the contract has breached an important resistance at 110-23, the May 16 high. A clear breach of this level would undermine a bear theme and highlight a stronger reversal, exposing 111-05+, May 9 high. For bears, a resumption of weakness would refocus attention on 109-12+, May 22 low.
STIR: Mix Of Short Setting & Long Cover Seen In Most SOFR Futures On Tuesday
OI data points to a mix of net short setting and long cover through the SOFR blues on Tuesday.
- The unchanged price status across the front 3 contracts means that we can’t make any definitive inference re: the direction of the apparent positioning adds and cover in those contracts.
| 03-Jun-25 | 02-Jun-25 | Daily OI Change |
| Daily OI Change In Packs |
SFRH5 | 1,070,435 | 1,068,762 | +1,673 | Whites | -7,428 |
SFRM5 | 1,428,383 | 1,452,788 | -24,405 | Reds | +10,569 |
SFRU5 | 1,121,424 | 1,119,211 | +2,213 | Greens | -5,547 |
SFRZ5 | 1,091,459 | 1,078,368 | +13,091 | Blues | +7,078 |
SFRH6 | 796,343 | 782,440 | +13,903 |
|
|
SFRM6 | 757,451 | 767,340 | -9,889 |
|
|
SFRU6 | 717,190 | 709,677 | +7,513 |
|
|
SFRZ6 | 837,979 | 838,937 | -958 |
|
|
SFRH7 | 671,938 | 669,179 | +2,759 |
|
|
SFRM7 | 585,423 | 586,744 | -1,321 |
|
|
SFRU7 | 414,903 | 415,716 | -813 |
|
|
SFRZ7 | 412,156 | 418,328 | -6,172 |
|
|
SFRH8 | 291,362 | 289,661 | +1,701 |
|
|
SFRM8 | 214,547 | 213,817 | +730 |
|
|
SFRU8 | 164,228 | 162,654 | +1,574 |
|
|
SFRZ8 | 173,212 | 170,139 | +3,073 |
|
|
