WARSAW, Sept 30 (Reuters) – Polish inflation in September came in slightly below expectations and remained at the same level as in August, strengthening market expectations for further interest rate cuts. However, the central bank may wait until November, when new forecasts are due, before making its next move. The statistics office said on Tuesday that flash inflation this month was 2.9% year-on-year, below analysts' average forecast of 3.0%. Month-on-month prices remained unchanged against the expected increase of 0.2%. In August, inflation was 2.9% year-on-year. The National Bank of Poland's inflation target is 1.5-3.5%. According to analysts, the biggest surprise was food prices, which unexpectedly fell by 0.5% month-on-month, which offset the increase in fuel prices. "We are facing further declines (inflation) in the coming months. Core inflation fell to approximately 3.1% from 3.2% in August," ING analysts wrote in a commentary on the data. "The Monetary Policy Council (MPC) will wait until November with the next interest rate cut, but the arguments for easing monetary policy are growing." New central bank inflation forecasts, which are one of the main factors influencing the decisions of Polish central bankers, will be published in November. The next MPC meeting will be held in early October. The National Bank of Poland (NBP) cut its main interest rate by 25 basis points to 4.75% in September, as most analysts had expected, citing a decline in inflation. Poland's central bank must be cautious when deciding on further interest rate cuts and consider inflationary risk factors such as loose fiscal policy, rapid economic growth and wage pressures, NBP governor Adam Glapinski said in September. (Reporting by Pawel Florkiewicz, Editing by William Maclean)
(The article has been published through a syndicated feed. Except for the headline, the content has been published verbatim. Liability lies with original publisher.)
