NBP gold plans and lower interest rates in Poland. The President of the National Bank of Poland comments

At its October meeting, the Monetary Policy Council, contrary to general expectations, reduced interest rates by 25 basis points. At the press conference, the President of the National Bank of Poland, prof. Adam Glapiński presented the justification for the Council's decision, referred to new plans to increase gold reserves and made an ongoing assessment of the economic situation in Poland.

Pursuant to the decision of the Monetary Policy Council published on July 2, 2025, the interest rates of the National Bank of Poland will be as follows:

• reference rate 4.50% per annum;
• lombard rate 5.00% per annum;
• deposit rate 4.00% per annum;
• rediscount rate of bills of exchange 4.55% per annum;
• bill of exchange discount rate 4.60% per annum.

“Taking into account the improvement in inflation prospects in the near future, in the Council's opinion, it has become justified to adjust the level of NBP interest rates,” the Monetary Policy Council said in a statement after the decision-making meeting. The Monetary Policy Council assessed, which is new in the October statement, that data from the corporate sector indicate a gradual decline in wage growth.

According to the Monetary Policy Council, the risk factors for low inflation are still the shape of fiscal policy, recovery in consumer demand and increased wage growth. Another source of uncertainty is the level of administered energy prices and global inflation patterns.

The President of the NBP on gold reserves

On November 5, we will introduce into circulation a collector banknote commemorating the millennium of the coronation of Bolesław the Brave – the President of the NBP began the conference.

I am pleased to announce that the NBP management board agreed to my proposal and decided to strategically increase gold stocks, increasing the share of gold in our reserves and reserve assets to 30%. This means we continue to buy gold. We already have resources that are slightly larger than we have presented so far and currently exceed 520 tons – President Glapiński boasted.

We will continue to buy gold. We will find opportunities to buy them at a favorable price whenever possible. Gold is the anchor of national security. The pillar of trust in our currency and economy is a guarantee of state and economic independence. We will not rush and act hastily. We have an experienced dealer team that operates on this market sensibly and with extensive experience. Our three basic principles are safety, liquidity and long-term profitability. As J.P. Morgan once said “there is only one money – gold, the rest is credit, i.e. all other currencies” – said President Glapiński.

The president justifies the interest rate cut

The Monetary Policy Council decided to reduce interest rates by 25 basis points. This is a very significant easing of monetary policy, which translates into the macroeconomic situation. I must add by the way, although this is not the goal of our action, it is good for the economy and significantly reduces the costs of public debt servicing – said President Glapiński, moving on to the latest decision of the Monetary Policy Council. Over PLN 17 billion in two years, this is how much the cost of debt servicing is reduced – he emphasized.

According to preliminary estimates of the Central Statistical Office, inflation in September amounted to 2.9%. This is already the third month in which inflation has remained within the NBP target with an acceptable band of deviations. (+/-1%).

Moreover, the prospects for the coming months improved more than the current quotations. The president signed the act freezing energy prices in the version presented by the government. This means prices will not increase for consumers. Our forecasts indicate that inflation in the fourth quarter will remain close to 3%. – indicated the president of the NBP. However, we see some risks in the medium term. Therefore, the Council remains cautious, he added.

Risks for inflation in Poland in the coming months

Firstly, despite the decline, inflation exceeds 2.5%. Moreover, core inflation remains stubbornly elevated. Secondly, energy prices have been frozen until the end of the year. Unfreezing prices from the beginning of the year will increase CPI inflation by approximately 0.4-0.3 percentage points. A further risk for energy prices is the entry of the ETS2 system in 2027, bound by climate goals. Estimates indicate that this may increase inflation by 2 percentage points. Thirdly, demand in the economy is growing relatively quickly. This is good for the economy, but these are pro-inflation factors, said President Glapiński.

The President of the NBP later in the conference returning to risk factors as: the fourth mentioned wage increases. He emphasized, however, that the base scenario is a further decline in wage growth. Fifthly, a loose fiscal policy in Europe is a threat.

Well, how do you usually reduce the deficit? Expenses are reduced and revenues are increased. Well, how can you increase revenues? Firstly, by strong economic growth. We have this, but secondly, due to the increase in taxes, of course – added Prof. later in the conference. Glapiński.

We are mainly afraid of ETS2 in 2027 resulting from EU policy. We pray that some sense will return to the European Commission and that it will stop these actions that are hitting Poland so hard, but the times are short, because it is even beneficial for the Germans – he pointed out.

Fiscal policy is therefore unfortunately pro-inflationary and reduces the space for interest rate cuts. What I am saying is in no way a criticism of the government. We know perfectly well what the government can and cannot do, what its limitations and barriers are. It limits it, but it doesn't mean it completely closes it – emphasized the president.

Glapiński: The Polish “economic miracle” is thanks to hard work

Poland's GDP growth should be higher than last year. This shows that the current level of interest rates does not constitute a limitation to Poland's ability to achieve rapid growth, said the president of the central bank.

The Polish “economic miracle” is thanks to the hard work and entrepreneurship of Poles, including, ladies and gentlemen, the length of work. This is why every idea of ​​shortening working time in Poland, in one way or another, is against Poland's interest. Such ideas can only be implemented after achieving a level of decent economic development. What is a decent level? We define it as the level of today's France or today's Great Britain – said prof. Glapiński.

The number of hours worked by one employee in Poland is among the highest. It averages over 38 hours a week. How does it compare to other countries? This is 30% more than the average in the euro zone, but, for example, 50% more than in Germany. First of all, it is the effort of women at the expense of families. Unfortunately, at the expense of children, at the expense of fertility, but Poland has a chance to catch up with the richest countries in terms of civilization – continued the head of the NBP.

What about this deficit?

Military spending is responsible for, among other things, 1/5 of the increase in the deficit. The public finance sector deficit grows mainly before social spending, including salary increases for successful social groups. They were responsible for over 60 percent. deficit increase. The cost of debt servicing should be added to this, said Adam Glapiński.

This year, this cost will increase to PLN 70 billion. according to our simulation, a reduction of 125 bp. carried out this year reduces this cost by PLN 17 billion over the next two years – the president reminded again.

Inflation is at a level consistent with the inflation target. The prospects for the coming months have improved. We also see some threats in the medium term, so we proceed cautiously. We pursue a conservative monetary policy, concluded President Adam Glapiński.

The Monetary Policy Council is waiting for the holy document – the inflation projection in November

We want inflation as a goal. The government and the parliamentary majority would always want inflation to be slightly higher than the target, because it brings higher budget revenues and reduces debt. The government would also like lower interest rates because it means a minority will have to pay the debt servicing costs. Well, this is normal, it is logical and it is embedded in the statutory and constitutional regulations, said the president of the central bank.

So is there no room for further reduction? It may be that there is this space. Depending on how we see the coming quarters, we will make decisions from meeting to meeting. As I see it now, there is such space if the good data holds – said Adam Glapiński.

Please remember that in November we will be after our November screening. This is our sacred document. Deep analysis of the economy and trends from month to month, quarter to quarter and year to year. Based on this projection, we will make a decision in November, he noted.

Can the rate cut before the November projection and the statement after the meeting be understood as an announcement of further cuts? – the question was asked to the president.

We make decisions from meeting to meeting. I already know some of the assumptions of the November projection. It's not like we made the decision now that we won't make it in November. Or if we have done it now, we will also do it in November. Nothing is certain. I can't say anything about this November. Well, because it is a sacred rule that decisions are not made in December, although this is not a regulation – replied President Glapiński.

It's just like the lottery and the casino. The fact that the result is red does not mean that it will not come out red in the next spin. Mathematics says that this probability is the same and those who think that once something happened it can't happen now are wrong, he added.

How much will interest rates fall?

I said it once at a conference and I'm not backing down from it, even though I don't have the support of the council and it didn't authorize me to do so, I think that we can go towards this 4 percent if inflation continues this way. How will it be 4 percent? Well, we'll see thenare you willing to lower it a bit – replied the president of the NBP when asked about the target level of rates, emphasizing, however, that the Monetary Policy Council does not have a target level of rates.

We in Poland are at a key moment. We are walking on the edge. We have a difficult situation at the moment and the central bank is a conservative institution that is sometimes beaten for doing something too slowly, but we have to watch whether any red light is turning on – replied President Glapiński when asked about the lowered prospects of Poland's credit rating.

For now, we don't seem to have incurred any costs, but of course it's also an alarm signal. There may also be a rating downgrade next year, but fortunately we have observed that there has been no change in profitability. They wag their finger at us and see what will happen this year – he added.

This night will be critical and in the morning we will tell whether the patient will be healthy, said President Glapiński in a literary manner. We are in such a situation but we will manage. I am convinced. Poland has always managed so far, so we will, said the president of the central bank. Council members see room for reductions, but they do not know yet when this will happen – he summed up the current mood in the Monetary Policy Council.

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