The Monetary Policy Council raised interest rates for the eighth time in a row. During the meeting on Thursday 5 May, the main interest rate increased by 75 basis points to 5.25%. Higher interest rates mean an increase in loan installments for millions of Poles. We checked how much the loan installments will increase after the May interest rate hike.
During the Thursday (5 May) meeting, the Monetary Policy Council raised the reference rate by 0.75 percentage points. Currently, it is already 5.25 percent and is the highest since 2008. It was the eighth in a row an increase in interest rates in the cycle of tightening the monetary policy in Poland, which started in October 2021.
Many economists predicted that the interest rate hike would be higher. Forecasts before the MPC meeting indicated that rates would go up by 100 basis points. The market reaction after raising the reference rate by 0.75 percentage points was immediate. Right after the announcement of the MPC decision the zloty depreciated against the euro by over PLN 0.03.
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Further increases in interest rates are caused by rising inflation, which in April amounted to 12.3 percent. and is the highest since 1998. Higher interest rates mean an increase in loan installments for people who pay off their liabilities in zlotys.
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