Wanted: New Growth Paradigm

When Poland's central bank in October cut interest rates by 30 basis points to 2%, it may have signaled to many that even Eastern Europe's strongest economy now was suffering from a slowdown, along with the rest of Europe. But in November, amid expectations of another rate cut, the central...

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Bibliographic Details
Published inGlobal Finance Vol. 29; no. 1; p. 16
Main Author Gupta, Udayan
Format Trade Publication Article
LanguageEnglish
Published New York Global Finance Media Inc 01.01.2015
Subjects
Alternative energy
Central banks
Deflation
Energy industry
Eurozone
Exports
GDP
Gross Domestic Product
Interest rates
Investments
Macroeconomics
Market positioning
Price cuts
Prime ministers
Renewable resources
Success
Supply & demand
Poland
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Summary:When Poland's central bank in October cut interest rates by 30 basis points to 2%, it may have signaled to many that even Eastern Europe's strongest economy now was suffering from a slowdown, along with the rest of Europe. But in November, amid expectations of another rate cut, the central bank stayed pat. And comments from Polish rate setters Elzbieta Chojna-Duch and Jerzy Hausner suggest that the next rate cut -- much to the government's displeasure -- may not be soon. While the new Polish government continues to push for further rate cuts to boost falling consumer prices, its real worry may be Poland's strong zloty. In an environment where demand for exports has weakened, a strong zloty could further dampen demand, Finance minister Mateusz Szczurek recently warned. Poland's success during the years 1989-2004 was the result of building the institutional bases of the free-market economy.
ISSN:0896-4181