As Covid-19 spreads, causing more countries to take counter-measures, Central and Southeast Europe is no exception. ING’s latest report said that collectively it is downgrading the 2020 GDP outlook on the back of virus fears.
Prof. Adam Glapiński, Prezes NBP (Fot. NBP)
Poland’s central bank governor has dismissed short-term concerns over inflation, even as other central banks in the region have begun to raise interest rates to combat a surge in prices.
Adam Glapinski said the data was not currently “worrying”, noting that inflation was partly driven by transient and external factors such as base effects, and fuel prices. Currently the second highest in the EU, Polish year-on-year inflation hit 4.7 per cent in May, before easing to 4.4 per cent in June.
“When we subtract from headline inflation the impact of regulatory and supply-side factors we get inflation close to 2.5 per cent, which is the midpoint of our inflation target,” he told the Financial Times. “So at the moment, there is no cause for alarm, especially as we also expect headline inflation to fall.”
Inflation has rebounded in many countries as pandemic restrictions are lifted, prompting some economists to call for central banks to wind down the stimulus measures adopted during the crisis. Central banks in Hungary and the Czech Republic both raised rates last month. (…)
James Shotter in Warsaw 04-07-2021