Grabowski: RPP may raise the rates again if inflation does not fall
Boguslaw Grabowski, an RPP member, said that if inflation does not fall after the supply shocks are relieved, RPP would not hesitate to raise the rates again. Grabowski said that RPP is aware that higher rates will cause slower growth of investment and the economy as a whole, but, in his opinion, the monetary policy influences economic growth through long-term monetary stabilisation. Another RPP member, Grzegorz Wojtowicz said that the banks should react to the higher rates within the next four to six weeks. According to Wojtowicz, the currency market has already discounted the hike and should not be surprised. Higher rates do not necessarily mean slower economic growth and higher CA deficit, Wojtowicz added. In his opinion, there is a chance that the CA deficit dropped to 7% of GDP by the end of the year. He also said that very strong external demand and faster growth of exports make it reasonable to predict GDP growth of 5% in 2000 and 2001.
Źródło:IntelliNews Daily
