Too early to discuss Polish rate cuts, says central banker Duda

WARSAW, April 27 (Reuters) - It is still too early to discuss potential interest rate cuts in Poland, even though inflation will probably slow sharply in coming quarters, central banker Iwona Duda said. Poland's benchmark rate has been at 6.75% since September and investors in emerging Europe's largest economy are focused on when borrowing costs there might start to fall. "In my opinion, it is still too early to start discussing potential interest rate cuts. The uncertainty is too high," Duda said, adding that, for the time being, the bank's monetary policy council (MPC) had no comment on when its tightening cycle might end. "We are still determined to lower inflation in the medium term. The incoming data confirm that the MPC's decisions in recent months were correct," she told Reuters in an interview. Duda's views chime with those presented by Bank governor Adam Glapinski following this month's policy meeting. She said the scenario of easing price pressures outlined in March's central bank projection was taking effect, and that annual inflation should be back in single digits by the end of 2023.

Inflation dipped to 16.2% in March from 18.4% in February, and preliminary data for April is due on Friday. "We expect that the next quarters will be a period of strong and systematic inflation deceleration" supported by the cooling of domestic and global economic conditions and a "clear slowdown" in consumption as the full impact of higher rates filters through, Duda said. According to the central bank's estimates, already implemented rate hikes should cut inflation by 2.8 percentage points this year, she added. (Reporting by Pawel Florkiewicz; editing by John Stonestreet)