Head of Poland’s central bank says economic situation in Poland 'good'

Wojciech Olkuśnik/PAP

The economic situation in Poland is not playing a major role in the current depreciation of the zloty (PLN), since it is "good," the governor of Poland’s central bank (NBP) has said.

The PLN is going through a difficult time and EUR exchange rate is the highest in 12 years at PLN 4.71. Also, the USD costs PLN 4.19, while the CHF, a currency important for many Polish mortgage borrowers, is worth PLN 4.49.

Adam Glapinski told the Interia web portal: "The current depreciation of the zloty is being influenced by several factors, but the economic situation in Poland is certainly not one of them, because this situation is very good."

He said that a further weakening of the zloty exchange rate "would not be consistent within the framework of the Polish economy, nor with the monetary policy being pursued by the NBP."

"We cannot forget about the pandemic which, especially in recent weeks, is still having an effect on the mood of the financial markets in Europe and Poland," he pointed out.

Glapinski also noted that the NBP's interest-rate hikes over the past few months, and the fact that market players in their analyses and appraisals assume a scenario of further increases in interest rates, should be favorable for the zloty.

"The recent interest-rate hikes will not immediately reduce inflation, but should reduce the risk that price growth will persist during the favorable economic conditions in Poland," concluded the governor of Poland's central bank.