Reuters scores exclusive interview with Polish central bank governor

An exclusive Reuters interview with Polish central bank governor Marek Belka changed the markets’ expectations for monetary policy and moved the zloty sharply. Interviewed by Reuters, Belka used the opportunity to send a signal to the markets, declaring: “The time for observing the situation in monetary policy is ending. I definitely believe that rates should be raised preemptively, not just in case.” This showed the central bank had become significantly more hawkish than many investors had assumed; in response to the interview, BNP Paribas altered its forecast from unchanged policy rates until 2012 to a 25 basis point rate hike in the first quarter of this year. The zloty climbed from about 3.93 against the euro to 3.89 within a couple of hours, while Polish bond yields rose.