Poland's central bank to maintain independence

WARSAW: Poland's central bank will maintain its independence and keep rates unchanged, recently appointed rate-setter Marek Chrzanowski told media, despite statements from ruling party leaders favouring dovish policies. "I feel no pressure at all, (there are) no attempts to sway our decisions. As the Monetary Policy Council, we are independent, we do not get any action recommendations," Chrzanowski said in an interview released on Monday. Before October parliamentary election swept them to power, a senior official from the Law and Justice (PiS) said the party would consider a candidate's propensity for monetary easing when nominating council members.

PiS officials also said they wanted the central bank to introduce a cheap-lending programme, comparable to European Central Bank's Long-term Refinancing Operation, and amounting to about $88 billion over six years. The opposition and some central bankers said those policies would undermine the central bank's independence. But Chrzanowski, who PiS nominated to the central bank's Monetary Policy Council, said there was no room for unconventional monetary policy. Any change in monetary policy would disturb the balance supporting the Polish economy, he said. Rates have remained unchanged since March 2015, when the central bank cut them by half a percentage point to a record low of 1.50 percent. "We don't want to make any decision not justified by fundamental changes," Chrzanowski said. Poland's deflation, which has seen consumer prices fall for over a year, is mainly caused by outside factors, he said. Poland's consumer prices fell by 0.5 percent year-on-year in December. "I don't think it's a major threat, because deflation is being imported," Chrzanowski said.