There is a decision on loans. This has not happened since 2015.

• The Monetary Policy Council (MPC) left the interest rates of the National Bank of Poland (NBP) unchanged.
• The main NBP interest rate, the reference rate, remained at 5.25 percent per annum.
• Interestingly, the real interest rate has recently risen to its highest level since 2015.

The two-day meeting of the Monetary Policy Council ended on Wednesday. The MPC - as expected - left interest rates unchanged.

• The reference rate is 5.25 percent per annum.
• Lombard rate: 5.75 percent;
• deposit rate: 4.75 percent;
• bills of exchange rediscount rate: 5.30 percent;
• bill discount rate: 5.35 percent

Further decisions of the Council will depend on incoming information on the outlook for inflation and economic activity, the Monetary Policy Council said in a statement.

A Breakthrough in Credits. This Hasn't Happened in 10 Years

As ING economists noted, the Council's June decision was in line with market expectations and was consistent with President Glapiński's communication from the May press conference. "The room for rate cuts later in the year is significant in our opinion," they noted, adding:

• Core inflation continues to trend downward, with the headline CPI inflation rate being lower than expected in May;
• in addition, the May decision of the Energy Regulatory Office (ERO) will reduce household gas bills by about 10 percent;
• As a result, CPI inflation may be close to the central bank's inflation target (2.5%, +/- 1 percentage point) in July.

Experts expect that the NBP's July inflation projection will bring a clear downward revision of the inflation path compared to the March scenario.

We expect the Council to cut interest rates by 25 basis points in July, starting a cycle of monetary policy easing. We expect further cuts on the same scale in September and November, and at the end of 2025 the reference rate may amount to 4.50 percent. A factor limiting the scale of rate cuts may be the risk of continued loose fiscal policy - we read.

A month ago, ING economists pointed out that the expected decline in inflation in the coming months - amidst the continued high nominal interest rates - resulted in a significant increase in the ex ante real interest rate (adjusted for future inflation).

Based on our inflation forecasts for the next 12 months, we estimate that the real rate has risen to its highest level since 2015.

More light on the prospects of the next steps of the Monetary Policy Council may be shed by the press conference of President Adam Glapiński on Thursday. It will start at 3 p.m.