Interest rates in August 2026: will borrowers get some relief?

In August 2026, interest rates remain under pressure from external factors, and following the July decision by the MPC to keep them unchanged, borrowers should not count on quick and significant installment reductions in the near future. The Monetary Policy Council decided to leave the reference rate at 5.75 percent. This decision closes the door to short-term changes in the wallets of those repaying variable-rate mortgage loans.

Evolution of interest rates: from November 2024 to summer 2026

The history of monetary policy in Poland over the last two years is a process of laboriously exiting a restrictive cycle that was initiated in response to galloping inflation. November 2024 was a period of waiting, during which interest rates remained at 5.75 percent. The financial market was discounting the following months in anticipation of a signal from policymakers at the National Bank of Poland.

The turning point that a significant part of the market was waiting for was November 2025. The Monetary Policy Council decided then to loosen monetary policy, which was described as the second autumn quarter. It was a long-awaited move, but limited in scale, which did not bring a revolution in debt servicing costs. Economist Dr. Jakub Borowski, in his comments for the banking sector, repeatedly emphasized that the road to an optimal interest rate level is a long-term process, and its end is set for the end of 2026.

The July 2026 MPC decision, announced on July 8, confirmed that the cycle of cuts is not a straight line. Maintaining rates at 5.75 percent was a direct reaction to the escalation of tensions in the Middle East. The conflict between the USA and Iran, which intensified in July, caused a sharp reaction in currency markets. The zloty, as an emerging market currency, lost value, which forced the central bank to adopt a defensive stance. Borrowers who were counting on significant installment cuts in August 2026 must confront their expectations with hard macroeconomic data. The MPC shows no haste, considering the stability of the zloty a priority that outweighs immediate relief for mortgage holders.

Geopolitics as a brake on NBP decisions

The international situation became a key parameter in 2026 influencing decisions made at the National Bank of Poland headquarters on Świętokrzyska Street. After the July meeting of the Council, during which rates were maintained at 5.75 percent, it became clear that external factors dominate domestic inflation indicators. Tensions between the USA and Iran escalated in July, introducing nervousness to global commodity and financial markets.

Every piece of information about the intensification of the conflict in the Persian Gulf causes an immediate depreciation of the zloty. The National Bank of Poland, ensuring price stability, cannot allow further weakening of the domestic currency, as this leads to imported inflation. If the MPC had decided to cut rates at a time when the zloty exchange rate is under pressure, it would risk losing control over inflation expectations. This is a mechanism where the country's currency security becomes an insurmountable barrier for those expecting lower installments.

It is worth looking at this from the perspective of the Council members. Their priority is to avoid shocks that could lead to lasting economic instability. Maintaining rates at 5.75 percent is a stabilization tool. For the average mortgage holder, this means no good news in the August cost summary. From the point of view of the NBP's strategy, fighting inflation is a process in which there is no room for premature loosening. As long as the conflict in the Persian Gulf region is not extinguished or the situation in commodity markets does not significantly improve, the MPC will maintain a "wait and see" mode. The stabilization of the price of money, which we hear about so often in official communications, is in practice a freeze on high debt servicing costs for the coming months.

The situation of borrowers: why are installments not falling?

The July decision of the Monetary Policy Council to keep interest rates at 5.75 percent definitively ends hopes for quick and significant reductions in mortgage installments at the end of the summer. For households repaying obligations based on a variable rate (WIBOR 3M or 6M plus bank margin), this means maintaining the current budget burden. There is no talk of the "breather" that was expected after earlier announcements of monetary policy normalization.

Let's imagine an example mortgage loan of 500,000 zlotys, taken out for 25 years, with a bank margin of 1.8 percent. With a reference rate of 5.75 percent and taking into account WIBOR, which oscillates close to the NBP rate level, the interest rate on such a loan is about 7.55 percent. The monthly capital-interest installment for such a borrower is in the range of 3700–3800 zlotys. Keeping rates unchanged means that this amount will not decrease in August or September 2026.

Financial markets are reacting to this data with clear distance. The main culprit is geopolitical instability. The zloty, remaining under pressure, excludes aggressive monetary policy loosening that could further weaken the currency. As a result, Poles' wallets must face the fact that:

The lack of further cuts in July 2026 means stagnation in the amount of installments, which are stuck at higher levels than the optimistic scenarios from the beginning of the year predicted.
Forecasts indicate no sudden changes in the short term, which means that current debt servicing costs will remain with us for at least the next quarter.

Economists remind us that the road to the optimal level is bumpy. From the borrower's perspective, it is crucial to understand that the MPC prioritizes currency stability and the fight against external inflation shocks over immediate relief for mortgage holders. If someone was counting on cheap credit before autumn, they had to revise their assumptions. The time for easy decisions has passed, and in August 2026, monetary policy became a hostage to factors over which the Polish consumer has no influence. It remains to wait for subsequent meetings, although without major illusions about a breakthrough.

Economic forecasts for the end of 2026

Market hopes for a sharp drop in loan installments collided with the brutal reality of the Monetary Policy Council's decision from July 2026. Maintaining interest rates at 5.75 percent is a clear signal for holders of zloty-denominated mortgage loans: do not count on quick and significant cuts in the near future. The external pressure that the domestic economy is facing effectively curbs appetites for aggressive monetary policy loosening. The MPC cannot afford a mistake that would cost the loss of control over the currency exchange rate.

Analysts have long been tempering moods, pointing to the need for a long march toward neutral rates. As early as November 6, 2025, economists quoted by "Forbes" communicated that reaching the optimal level for the Polish economy would happen at the earliest at the end of 2026. Today, looking at the map of challenges, this forecast seems exceptionally accurate. The cycle of cuts, initiated last autumn, is technically ongoing, but it requires enormous patience. It is strictly dependent on two foundations: a lasting fight against inflation and maintaining the stability of the zloty in the face of tensions on the international stage.

Every move by the Council must be surgically precise. Borrowers must prepare for the fact that their wallets will not feel relief in the third quarter. Stabilization, not a dynamic drop in the cost of money, is the base scenario for the end of the year. The monetary transmission mechanism works with a delay, and policymakers clearly prefer caution over the risk of price destabilization. For household budgets, this means the necessity of further tightening belts, without illusions about a return to cheap lending in the coming weeks. The expected turning point is shifting to December, although even this date is not a guarantee of widespread relief. The situation remains fluid, and geopolitical variables can force a correction of these assumptions at any time.

Comparison table: expectations vs. reality

Hopes for a clear loosening of monetary policy in mid-2026 collided with reality. Back in the spring, analysts and the capital market looked at the Monetary Policy Council's meeting calendar with optimism, counting on the downward path of rates, initiated in the autumn of 2025, to maintain its pace. Reality, however, turned out to be definitely more conservative. The July MPC decision, according to information from July 8, 2026, confirmed the maintenance of interest rates at 5.75 percent, which cooled the enthusiasm of those who were planning to refinance their obligations.

Here is how the comparison of forecasts with the actual moves of policymakers looked:

Market forecast (Direct Money, April 13, 2026): It was assumed that the cycle of cuts would continue based on trends from the end of 2025, counting on a drop in rates below 5.5 percent.
MPC decision (Parkiet, July 8, 2026): Maintaining rates unchanged at 5.75 percent as a direct reaction to external risks and tensions in the Middle East.

The main brake for the Council became the geopolitical situation. Tensions between the USA and Iran, which INNPoland reported on July 8, effectively blocked the space for bolder cuts. The zloty found itself under clear pressure, and in such conditions, the central bank prefers to avoid risky actions. For the average borrower, this means one thing: installments will remain at the current, high level for the coming months. There is no talk of the quick and significant relief of household budgets that was whispered about as recently as April. The market has already priced in this scenario, and optimists counting on cheap loans before the end of the holidays had to revise their expectations. The stabilization we are observing in August is not a temporary pause, but the result of a long-term defensive strategy against external shocks over which the domestic economy has no direct influence.

The role of the NBP in stabilizing the economy

The National Bank of Poland, after the Monetary Policy Council's July decision to keep the cost of money at 5.75 percent, is sending a clear signal: there is no room in August for quick and significant loan installment cuts. The institution remains under clear pressure from external factors that effectively block more bold moves toward loosening monetary policy. The escalation of tensions between the USA and Iran and the resulting instability in international markets mean that policymakers from Świętokrzyska Street are opting for caution.

For holders of zloty loans, this means remaining in limbo. The NBP's priority remains maintaining the stability of the financial sector, which in practice boils down to avoiding sudden decisions that could destabilize the domestic currency exchange rate. Inflation, although it shows a downward trend, in the eyes of the council still constitutes a variable too sensitive to external shocks to risk loosening monetary policy in the middle of the holidays.

Analysts point out that after the November cuts of 2025, the dynamics of change have clearly slowed down. The current NBP strategy is survival in a difficult geopolitical environment, not a fight for popularity among indebted households. Every move toward cheaper money is currently analyzed through the prism of a potential weakening of the zloty, which, with high prices of imported raw materials, would be a dangerous move. Borrowers must arm themselves with patience. Institutions responsible for monetary policy communicate that the fight against inflation is a long-term process and for now there is no room for maneuver that would bring noticeable relief in monthly obligations. Illusory hopes for cheap credit before the end of the year collide with a hard reality, where the financial security of the state stands above the comfort of the statistical borrower's wallet.

What this means for you

For the average borrower, this means that the period of cheap credit has not yet arrived. Financial institutions remain in a waiting mode, which translates into stable but high debt servicing costs. Those saving on deposits gain, while those who counted on quick relief in household budgets lose. If you have a loan of 500,000 zlotys, your installment remains at the level of about 3700–3800 zlotys, assuming an interest rate of 7.55 percent. It is worth paying attention to whether your bank anticipates changes in margins or if it offers the possibility of switching to a periodically fixed interest rate, which may be a hedge against potential increases in WIBOR in the event of an escalation of armed conflicts. In the face of August 2026, a safe spending planning strategy should assume that interest rates will not fall in the near future.

The analysis of data from July 2026 indicates unequivocally that the Monetary Policy Council in its decisions is guided primarily by the stability of the zloty exchange rate. From the borrower's point of view, this is information about a high degree of predictability, but also about a lack of positive impulses. Waiting for interest rate cuts is currently more of a game of patience than real budget planning. It is worth monitoring MPC communications after each meeting, because that is where, and not in market forecasts, decisions shaping the cost of living for Poles are made. Geopolitical risk, including tensions between the USA and Iran, remains a factor that may dominate the central bank's agenda for the coming months. In this context, people with mortgage loans should prepare to maintain current financial burdens until the end of the year. Stability has become the new norm, and cheap lending remains a scenario that requires further waiting for the situation on the international stage to calm down.

Questions and answers

Did interest rates change in August 2026?

No, after the last MPC meeting in July 2026, interest rates were maintained at the current level of 5.75 percent.

When can significant loan installment cuts be expected?

Economists forecast that Poland will approach the optimal interest rate level at the earliest at the end of 2026, which is dependent on inflation and the zloty exchange rate.

Why is the MPC not lowering rates in the current situation?

MPC decisions are determined by geopolitical risks, in particular the escalation of tensions between the USA and Iran, which exerts pressure on the zloty exchange rate and forces the NBP to be cautious.

Sources

Article prepared by the Wiadomości PRO editorial team with the support of artificial intelligence. Facts come from the sources provided above.