NBP: Growing Number Of MPC Members Ready To Back May Cut
Several MPC members threw their weights behind imminent monetary easing after the release of dovish labour market and economic activity data this week, which seems to have sealed the deal on the direction of the move in rates at the upcoming meeting. Gabriela Maslowska changed her call and now told Bloomberg that she might vote for a 25bp reduction next month if April inflation comes in on the softer side. This represented a shift in her earlier view that rates could be reduced no earlier than at the end of this year. Ludwik Kotecki told PAP that recent data support an interest-rate cut scenario in May, although 'inflation is still elevated', which requires some caution, 'that is, to start in May with a 25-50bp reduction.' Henryk Wnorowski told ISBnews that headline inflation may exceed the tolerance band around the target by just 1pp in April, which would increase the odds of a 50bp rate cut in May.
- By our count, seven out of ten members of the rate-setting panel have now declared that monetary easing could start in May, although Ireneusz Dabrowski did it in a cautious manner (i.e. calling July a 'very safe moment' to start cutting rates without ruling out earlier action). Iwona Duda, who last commented on monetary policy on March 24, said that cuts might have to wait until July, while hawkish dissenter Joanna Tyrowicz keeps insisting that monetary easing is out of the question.
- As a reminder, MPC decisions are made by putting a motion on a specific rate adjustment to a vote and a simple majority is sufficient for a motion to pass. The Governor holds a tie-breaking vote, but barring the need to cast it, his vote carries the same weight as those of other members. A decision to keep interest rates unchanged does not require a vote.
- The market is leaning towards a 50bp cut at the next MPC meeting to be held on May 6-7, with the 3-month WIBOR/1x4 FRA spread currently sitting at around -40bp. Further out the curve, 3-month WIBOR/9x12 FRA spread is around 174bp, with the market pricing a fairly aggressive rate-cutting cycle this year.
- The imminent start of monetary easing prompted some MPC members to comment on the terminal rate. During his April presser, Governor Glapinski said it could be 3.50% in 2026, while Ludwik Kotecki told Pulz Biznesu today that he sees it at 3.5%-4.0%. Henryk Wnorowski suggested that rates will probably be at a level with a 4% handle at end-2025.
Table 1. Summary of latest comments from all MPC members.
| Member | Latest Comments | Expected Timing Of Rate Cuts |
| Adam Glapiński | Sees room for cuts, potential from May, if dovish data repeats. The initial cut could be by 50bp. Terminal rate could be 3.50% in 2026. | May 2025 |
| Ireneusz Dąbrowski | “The decision to cut rates may come sooner, but in my opinion July is a very safe moment. Any earlier carries a certain risk, but perhaps the Council will decide to do so and there will be a proposal on this matter.” | July 2025 (perhaps sooner) |
| Iwona Duda | “Only the July projection can provide arguments decisive for the prospects of interest rate cuts, both in terms of timing and scale.” | July 2025 |
| Wiesław Janczyk | “There is a good chance of a rate cut at the upcoming Council meetings (...) Waiting until the July projection may not be necessary.” | May 2025 |
| Cezary Kochalski | Would consider backing a 50bp rate cut in May. | May 2025 |
| Ludwik Kotecki | “Inflation is still elevated, and in such a situation some caution regarding cuts would be advisable - that is, to start in May with a 25-50bp reduction.” Sees room for 100bp worth of cuts in 2025. | May 2025 |
| Przemysław Litwiniuk | “There are grounds to cut rates by 50bp by the end of Q2, in one or possibly two steps. There are differing views within the MPC as to the scale of the first step.” | May 2025 |
| Gabriela Masłowska | “It can’t be ruled out that interest rates will be cut in May. The CPI reading in April and especially the July projection will be crucial for the decision to cut interest rates in the coming months.” | May 2025 |
| Joanna Tyrowicz | Seemingly still calls for a 200bp rate hike. | - |
| Henryk Wnorowski | “I believe that much is already clear, but April 30 and the flash reading of April CPI will be key for the MPC’s May meeting. I am not ruling out anything, considering that a 50bp interest-rate cut in May has been floated in the comments of many of my colleagues. I never mentioned a 50bp cut, but it doesn’t mean that it can’t happen.” | May 2025 |
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SILVER TECHS: Uptrend Remains Intact
- RES 4: $35.736 - 1.236 proj of the Feb 14 - Apr 12 - May 2 ‘24 swing
- RES 3: $34.903 - High Oct 23 ‘24 and the bull trigger
- RES 2: $34.548 - High Oct 29 ‘24
- RES 1: $34.233 - High Mar 18
- PRICE: $33.150 @ 08:08 GMT Mar 25
- SUP 1: $32.665 - Low Mar 21
- SUP 2: $32.222/30.815 - 50-day EMA / Low Feb 28 and key support
- SUP 3: $29.704 - Low Jan 27
- SUP 4: $28.748 - Low Dec 19 and a bear trigger
Silver continues to trade below its recent highs. Short-term weakness is considered corrective and a bull cycle remains in play. The metal has recently breached a key resistance at $33.397, the Feb 14 high, confirming a resumption of the bull cycle that started Dec 19. This signals scope for a climb towards $34.903, the Oct 23 ‘24 high and a medium-term bull trigger. Key trend support has been defined at $30.814, the Feb 28 low.
STIR: Implied Probability Of An April ECB Cut Has Inched Higher In Recent Weeks
The ESTR OIS implied probability of a 25bp ECB cut on April 17 has moved from less than 50% two weeks ago to around 65% at typing. We noted in our latest weekly wrap that the balance of last week’s ECB-speak veered in a dovish direction, with several Governing Council members appearing open to the idea of an April cut. See here for more.
- However, incoming data (particularly the March flash inflation figures and the Q1 Bank Lending Survey) remain key alongside the extent of US tariff announcements from April 2.
- OIS price 51bps of easing through year-end, ~1.5bps more hawkish than yesterday’s close.
- Euribor futures are a touch softer through the blues versus yesterday's settlement, weakening alongside Bunds.
- Today’s regional calendar is headlined by the German March IFO survey. The expectations component may be supported by the recent fiscal announcements, but the Business Climate and Current Assessment components will provide a better gauge of sentiment in the immediate term.
- ECBspeak is due from Kazimir, Muller, Holzmann, Vujcic and Nagel. Yesterday evening, Escriva noted that growth risks are tilted to the downside but inflation risks are unclear, given the “extreme” uncertainty the economy is facing.
| Meeting Date | ESTR ECB-Dated OIS (%) | Difference Vs. Current Effective ESTR Rate (bp) |
| Apr-25 | 2.255 | -16.3 |
| Jun-25 | 2.085 | -33.3 |
| Jul-25 | 2.039 | -37.9 |
| Sep-25 | 1.958 | -46.0 |
| Oct-25 | 1.944 | -47.4 |
| Dec-25 | 1.911 | -50.7 |
| Feb-26 | 1.909 | -50.9 |
| Mar-26 | 1.913 | -50.5 |
| Source: MNI/Bloomberg. | ||
USDCAD TECHS: MA Studies Remain In A Bull-Mode Position
- RES 4: 1.4793 High Feb 3 and key resistance
- RES 3: 1.4700 Round number resistance
- RES 2: 1.4641 76.4% retracement of the Feb 3 - 14 bear leg
- RES 1: 1.4452/4543 High Mar 13 / 4 and a bull trigger
- PRICE: 1.4322 @ 08:01 GMT Mar 25
- SUP 1: 1.4242 Low Mar 6 and a key near-term support
- SUP 2: 1.4151/4107 Low Feb 14 / 50.0% of Sep 25 - Feb 3 bull run
- SUP 3: 1.4011 Low Dec 5 ‘24
- SUP 4: 1.3944 61.8% retracement of the Sep 25 ‘24 - Feb 3 bull cycle
USDCAD continues to trade closer to its recent lows. The bull cycle that started Feb 14 is intact and moving average studies remain in a bull-mode position, highlighting a dominant uptrend. A near-term key support to watch lies at 1.4242, the Mar 6 low. Clearance of this level would undermine the bull theme and instead highlight potential for a test of 1.4151, the Feb 14 low and a bear trigger. The bull trigger is 1.4543, the Mar 4 high.
