Poland holds key interest rate at record low

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The National Bank of Poland held its benchmark reference rate at a record low of 0.1% during its meeting on Wednesday, amid efforts to cushion the adverse impact of the ongoing health crisis and support the economic recovery, Polish Radio's IAR news agency reported.

The council decided on a string of rate cuts last year amid a coronavirus epidemic which has dented the economy. Last March, in its first change to interest rates in five years, the Monetary Policy Council lowered the reference rate from 1.5% to 1%.

After the annual inflation rate rose to 2.7% in January 2021, from a 19th-month low of 2.4% in the previous month, the central bank revised higher its inflation forecast to 2.7-3.6% in 2021 (from 1.8-3.2%); and 2-3.6% in 2022 (from 1.6-3.6%).

At the same time, policymakers revised its GDP expectations to 2.6-5.3% in 2021 (from 0.8-4.5%); and 4-6.9% in 2022 (from 3.8-7.8%). Also, the Lombard rate and the deposit rate were kept steady on Wednesday at 0.5% and 0%, respectively, and the rediscou nt rate was left unchanged at 0.11%. 

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