Poland: October Inflation Report Summary
Overview:
The NBP has released its October Inflation Report. This notes that both GDP growth and inflation readings have been slightly firmer than expected during the third quarter. Nevertheless, the basic outlook for inflation is pretty much unchanged from the June Report. Inflation is likely to fall towards the centre-point of the 2.5% inflation target during the rest of this year from the current 3.4%. It is then likely to fall below the 1.5% lower-bound of the inflation target in mid-2010 given sub-par growth and a negative output gap. It should then rise modestly back within the band and towards the centre-point of the target in 2011. On the basis of this forecast the MPC sees the probabilities of inflation running below or above the inflation target as balanced; hence its move to a neutral bias at its October meeting.