The Monetary Policy Committee of Poland's central bank decided on October 8 to keep its benchmark interest rate unchanged at 3.75%, in line with market expectations.

Although the central bank stressed that the changes to this policy statement were merely technical adjustments and did not signal a shift in its monetary policy stance, the central bank's characterization of the inflation outlook changed after the September Consumer Price Index (CPI) rose above the upper limit of the inflation target range, and it once again listed the government's energy price regulatory measures as an important factor affecting future inflation.

September Inflation Breaches Target Ceiling, Central Bank Adjusts Wording on Policy Goal

After this meeting, Poland's central bank revised the final paragraph of its policy statement, changing its previous wording about "maintaining" inflation within the target range over the medium term to "ensuring" inflation remains within the target range.

This wording change came after Poland's September CPI had already breached the upper limit of the inflation target range, reflecting the change between the current inflation level and the central bank's policy goal.

However, the Monetary Policy Committee emphasized that the adjustment was a technical modification and did not mean the central bank would change its current wait-and-see stance.

Energy Price Regulation Returned to Inflation Outlook, Central Bank Continues to Wait and See

Another change in this statement was the re-inclusion of "regulatory decisions concerning energy prices" as one of the factors affecting the inflation outlook.

This wording had previously appeared in the central bank's policy statement in March this year, when the Polish government first introduced a temporary fuel tax reduction plan.

Energy prices and related government regulatory measures may affect the future path of consumer prices, and therefore have once again been included among the factors the central bank considers when assessing the inflation outlook.

Overall, Poland's central bank kept its benchmark interest rate unchanged at 3.75% this time while adjusting its description of inflation risks.

Against the backdrop of September inflation breaching the upper limit of the target, the central bank still chose to maintain the existing interest rate level and continue to observe changes in energy price policy and inflation trends.