MPC maintained its assessment that the gradual improvement in economic conditions was likely to continue over the coming quarters, while inflation pressure would remain limited. "In this context, the Council confirmed that it would be justified to maintain the interest rates at the current level at least until the end of the first half of 2014. At the same time, Council members recognized that the findings of the March NBP projection would enable a more comprehensive assessment of medium-term outlook for inflation and economic growth," the "minutes" read.
The Council first states that interest rates should remain flat until the end of H1 of 2014 in November of 2013 and has then reiterated that view several times.
At this meeting, central bankers highlighted that inflation - including core inflation - continued to be very low, and the available forecasts point to it likely remaining low also in the subsequent quarters. Low core inflation is supported by a further decline in producer prices and sustained low inflation in
In turn, the risk of substantial rise in energy or food prices is constrained by the conditions in international commodity markets, where the moderate scale of global economic recovery is conducive to price stabilisation. Therefore there is no significant risk of inflationary pressure rising markedly in
In January of 2014, consumer inflation was 0.7% y/y (ie. the same as a month earlier). The central bank's CPI target is 2.5% (+/- 1pp). The average annual inflation was 0.9% in 2013 vs. 3.7% in 2012.
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