<div class="topStory"> <h2></h2> <p>Isthe National Bank of Poland (NBP)the last inflation-targeting central bank still standing?</p><p>The bank shocked many today with a quarter point rate rise, naming stubbornly high inflation as the reason, and signalling that more tightening is on its way.TheNBPhas sounded hawkish in recent weeks but few had actually expected it to carry through its threat to raise rates. Economic indicators of late havebeen far from cheerful&ndash,moncler doudoune; just hours after the rate rise,nike air jordan, data showed Polish car production slumped 30 percent in April from year-ago levels. PMI numbers last weekpointedto further deterioration ahead for manufacturing. And sitting as it does on the euro zone&rsquo,doudounes moncler;s doorstep, Poland will be far more vulnerable than Brazil or Russia toany newsetback inGreece.Itsaction therefore deserves praise, says Benoit Anne, head of emerging markets strategy at Societe Generale,doudoune moncler.</p>
<p>(Poland’scentral bank) is one of the last orthodox inflation-targeting central banks in the global emerging market central bank universe. They are taking action because they are seeing inflation creeping up and have decided to be proactive. </p><p></p><p>The rate rise is especially notable given many central banks in developing countries appear effectively to have surrendered their inflation-fighting mandate,doudoune moncler. Nowhere is the push for lower interest rates more pronounced than in Brazil where the government last week announced in amove that is seen paving the way formore agressive rate cuts. Clearly there is tolerance here forhigher inflation,moncler pas cher, whichwill still end2012 well above target.</p><p>But many analysts such as Manik Narain at UBS consider Poland&rsquo,Moncler;s decision a high-risk one given the growthissues. Narainsees it possibly motivated by the need tosignalPolandwill not welcomefurther currency weakness (the zloty like most emerging currencies has shed much of its early-2012 gain) Therefore aprolonged monetary tightening cycle is unlikely,air jordan pas cher, he says. Indeedmany reckon the NBP may find itself, like the European Central Bank last year,reversing an ill-considered rate rise,air jordan. Analysts at Capital Economics write:</p>
<p>If we are right in expecting growth and inflation to slow by more than most expect over the second half of this year then this may well be the NBP’s “ECB moment”. Recall that having hiked rates twice in the first half of 2011,doudoune noncler femme, the ECB was forced to start loosening policy once again by November as the economy weakened. In Poland’s case, we think there is a good chance that today’s rate hike will be reversed by the end of the year.</p>Is the National Bank of Poland (NBP) the last inflation-targeting central bank still standing? </p></div>Related articles: