1/31/2008

Poland's central bank ups rates 25 bps, as expected

WARSAW (Thomson Financial) - Poland's central bank, as expected, raised interest rates by 25 basis points at a monthly meeting today, tightening borrowing costs for a fifth time since last April as it battles to bring inflation back to its 2.5 pct target.

The bank's main rate now stands at 5.25 pct. All but one analyst polled by the PAP state news agency had predicted the hike after inflation climbed to 4 pct in December.

Analysts expect the bank will raise rates at least once more in months ahead, but says comments from moderates on its policy council cast doubt on the 75 basis points in tightening priced in by debt markets for months ahead.

The bank will issue its full statement explaining its decision in a news conference starting at 4 pm CET today.

Source: By Piotr Skolimowski, forbes.com



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