Poland's Slawinski says central bank still in monetary tightening cycle

WARSAW (Thomson Financial) - Poland's central bank is still in the midst of a monetary tightening cycle, with inflation set to stay relatively high in coming months, due to the impact of supply side effects on prices, policy-maker Andrzej Slawinski said today.

Asked if the bank would continue to raise interest rates in March, Slawinski

told TVN CNBC: 'In my opinion we are still in a phase of monetary tightening.'

The Warsaw School of Economics professor, seen as one of a group of moderates who have the casting votes on the bank's council, has used this formula previously to indicate he supported further rises in interest rates.

But pressed on whether the bank could hike this month, he gave no stronger indication of whether borrowing costs should be upped quickly.

'Regulated prices will continue to raise inflation for some time. The labour market will be also be a reason for wage growth for quite some time. Food price growth will not fade as fast as all that,' he added.

The bank raised interest rates in February for the second time in as many months, bringing its main rate to 5.5 pct and prompting markets to price in another move in March or April, with more likely later in the year.

Source: By Paweł Sobczak, forbes.com