January CPI grows slowly, interest rates may be cut

APA - Austria Presse Agentur
opublikowano: 16-02-2006, 15:22

Warsaw (Puls Biznesu) – The January inflation data proved that growing remuneration and employment did not spark the CPI. Economists expect the Monetary Policy Council (MPC) to cut interest rates.

Warsaw (Puls Biznesu) – The January inflation data proved that growing remuneration and employment did not spark the CPI. Economists expect the Monetary Policy Council (MPC) to cut interest rates.

In January, the CPI growth amounted 0.2 percent month-on-month and 0.7 percent year-on-year. Economists expected 0.9 percent annual growth rate.

“This is a very good news, partly due to strong zloty, partly due to the fact that growing oil prices did not cause increases of goods and services”, Maciej Reluga, Bank Zachodni WBK chief economist commented.

According to preliminary data published by the central statistical office GUS, prices connected with transport fell by 1.7 percent. Fuel prices decreased “substantially”.

Food prices rose 0.4 percent month-on-month. In companies, there are good trends: employment rose 2.6 percent and remuneration by 3.6 percent year-on-year. Some economists believe, this may lead to growing consumption.

“I believe that the MPC will lower interest rates by 25 base points in February”, BZ WBK economist said.

Jacek Wisniewski, Raiffeisen Bank chief economist, did not agree.

“It is too early for a cut. I believe, MPC will withhold with its decision until the February data is published. Then, we will see how strong the changes in the labor market were. The chance for interest rate cut in March grows, however”, he said.

 

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Podpis: APA - Austria Presse Agentur

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