The National Bank of Poland today announced (as expected) that it would hold its policy rates for the eleventh straight month.
No surprise, though the country is suffering with above target inflation. But few European countries (notably Norway) have raised rates, and the eurozone crisis is causing others, who may have been on the cusp of following suit, to hold off.
“I think people flirted with rate hikes, but now that’s been scrapped as the European situation has deteriorated,” said Alan Ruskin, strategist at RBS Securities. Countries – even those outside of Europe such as China and possibly Canada – that were on the cusp of tightening are now in “wait and see” mode, Mr Ruskin said. “I think the prudent thing to do is to hold until they can see if the markets stablise.”