By Patryk Wasilewski
WARSAW--Poland's rate panel discussed halving its benchmark
interest rate to 1% in December, but a majority didn't support the
proposal, central bank minutes from the meeting showed.
In contrast to November, when the panel discussed three
proposals to lower borrowing costs, at the December meeting only
one option for cutting rates was put forward.
Poland's 10-strong rate panel decided to keep the benchmark rate
at 2% in December, but some of the rate setters who supported the
decision said they remained open to monetary easing in the future,
depending on duration of the current period of deflation and the
country's growth prospects.
There has been deflation in Central Europe's biggest economy
since July and some market watchers believe prices could decline
for months to come, possibly until next summer. In November,
consumer prices declined 0.6% annually.
In a separate document, the central bank said four rate setters,
including the bank's governor Marek Belka, were willing to cut
rates by 0.5 percentage point or 0.25 percentage point in November,
but faced opposition from the remaining six members of the panel.
As a result, borrowing costs remained unchanged.
The most radical proposal--to cut rates by one percentage point
in November--was backed only by one member of the council, Andrzej
Bratkowski.
Write to Patryk Wasilewski at patryk.wasilewski@wsj.com