Until Friday, February 27th, the market was almost certain of a 0.25 percentage point interest rate cut. However, economists have shifted their positions in recent days. An attack on Iran, missile strikes on tankers in the Strait of Hormuz, and the shutdown of gas processing in Qatar have impacted prices. Voices suggesting there would be no change in interest rates have grow increasingly frequent, such as the one from the mBank Research team on Tuesday.
Conversely, Pekao analysts maintained their forecast that a cut would still occur. As of Wednesday, the consensus of forecasts still pointed to a reduction.
Read also: The Polish economy may suffer after the attack on Iran. Economists point to options
Interest rates fell in March
The Monetary Policy Council (RPP) decided on Wednesday to lower interest rates by 0.25 percentage points, as predicted by the consensus of economists’ forecasts. The main interest rate (reference rate) has thus fallen to 3.75 percent.
The Council decided to reduce NBP interest rates by 0.25 percentage points to the following levels:
- reference rate 3.75 percent per annum;
- lombard rate 4.25 percent per annum;
- deposit rate 3.25 percent per annum;
- rediscount rate for bills 3.80 percent per annum;
- discount rate for bills 3.85 percent per annum.
The Monetary Policy Council’s resolution comes into effect on March 5, 2026. The next meeting of the Monetary Policy Council will be held on April 8-9.
“Installments will fall”
Even if rates had not been reduced, mortgage installments would have fallen anyway, as the level of WIBOR rates, on which mortgage interest rates depend, has decreased—according to Jarosław Sadowski, Director of the Analysis Department at Rankomat.
“The January cut will reduce the installment on a 500,000 zł loan over 30 years by 80 zł (from 2,998 zł to 2,918 zł),” he stated.
6M WIBOR is now 3.7 percent, which means that after the next interest rate update, the installment on a 500,000 zł loan over 30 years will fall by 351 zł per month. Compared to January 2025, according to Sadowski’s calculations, the installment has already fallen by almost 700 zł. The 6M rate takes into account the expected changes over the next six months, and the market is almost certain of a cut of at least 0.25 percentage points.
The installment on a loan based on 3M WIBOR will fall by 125 zł compared to the current level.
“A decrease in loan interest rates also means an increase in creditworthiness. In the case of a couple with a net income of 12,000 zł, the available loan amount will increase by approximately 25,000 zł. If the reference rate were to fall to 3 percent in a few months, the increase would be 280,000 zł compared to January 2025,” informs Jarosław Sadowski.
War in Iran will decide what happens next
The attack by the US and Israel on Iran has certainly disrupted many inflation forecasts. Europe is dependent on gas, and its prices determine electricity prices. On March 3rd, gas on the Aged Continent cost as much as 62 euros per MWh, twice as much as on Friday, before the conflict broke out.
Poland is also developing gas-fired power plants, which already provided 16 percent of energy in the system this year. Reports that “Iran is asking about peace terms” caused a drop in oil and gas prices on Wednesday. However, these are not yet official reports, and the situation is still far from calming down. However, if peace talks and acceptance of US terms were to capture place, the situation would have an impact on inflation only for a short time.
