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Emerging Europe's ‘Next One to Hike’ Goes Wobbly on Rate Liftoff

  • Governor still favors no change in borrowing costs this year
  • Central bank extended its record pause by holding rate at 1.5%
Warsaw, Poland.

Photographer: Piotr Malecki/Bloomberg

Updated on

Poland’s central bank is overcoming a divide over the need to tighten monetary policy this year, opting on Wednesday to keep interest rates unchanged without offering much guidance beyond 2018.

While repeating that a period of record-low borrowing costs could last through the rest of the year, Governor Adam Glapinski backed away from his view that Poland’s longest-ever rate pause should remain in place even in 2019. At the same time, a minority in favor of higher rates on the 10-person Monetary Policy Council saw a defection by one of its most vocal members, as Lukasz Hardt came around to offer Glapinski his backing.