MNI NBP Review - Mar 2025: Hawkish Talk Doesn’t Preclude Cuts

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Executive Summary:

• The NBP left interest rates unchanged and unveiled new projections.
• The tone of the press conference remained emphatically hawkish…
• … but the Governor admitted that the debate on future cuts is on.

The Governor stuck to his hawkish guns during the press conference following a universally expected on-hold rate decision and the release of the details of a new macroeconomic forecast, but a close scrutiny of his comments suggests that the central bank may still cut rates in 2H2025. Although the Governor insisted that the macroeconomic picture gives no reasons to loosen monetary policy, the reduction of uncertainty around energy prices and a lower starting point for inflation this year may inspire renewed discussion within the Monetary Policy Council (MPC) around the release of the next macroeconomic projection in July.