According to professor Dariusz Filar, the member of the Monetary Policy Council (MPC), hadn’t it been for last year’s tightening of the monetary policy, inflation in Poland would be much higher today.
“Interest rate increases made in 2007 which raised chances for zloty to appreciate, lowered today’s inflation by 1-2 percentage points. Without this, our price index would be similar to the one in the Czech Republic”, Dariusz Filar said.
In the Czech Republic, inflation amounted to 6.8 percent in May.
The economist believes, however, that further rate increases are probable even in 2009.
“The last inflation projection made by analysts from the National Bank of Poland provides that inflation will fall below 3.5 percent at the end of 2009 and beginning of 2010. This scenario is already under threat. The base inflation without food and energy prices is above the estimates and amounted to 2.1 percent in the second quarter against below 2 percent as expected. That’s why inflation may fall below 3.5 percent later in 2010. One should take into account that interest rates will be raised this and next year”, Dariusz Filar believed.
The government convergence program provides for 2.9 percent of inflation next
year. Professor Filar expects it won’t be easy. The provisions may be revised.