NBP interest rates: Is 5.75 percent the final decision?

In November 2024, the RPP maintained the reference rate at 5.75 percent, which provided a stable starting point for subsequent changes in the economic cycle of 2025-2026. Yes, 5.75 percent was the ceiling that set the direction for the next 24 months. This decision defined the framework within which financial institutions operated before global geopolitical tensions dominated the central bank's agenda.

Architecture of stabilization: Why did the RPP maintain 5.75 percent?

In November 2024, the Monetary Policy Council opted for a conservative strategy, recognizing that earlier attempts to loosen monetary policy could have been counterproductive. Inflation, although it had slowed compared to the peaks of previous years, still showed a tendency to return at the slightest sign of fiscal stimulus. Maintaining the reference rate at 5.75 percent was not a random move. It was a message directed at the banking sector and financial markets: currency stability is more important than short-term economic stimulation through cheap loans.

Council members argued that any decision to cut rates at that time would carry the risk of zloty depreciation. The Polish economy, being in a phase of transformation after a period of high inflation, needed an anchor. 5.75 percent fulfilled this role perfectly. Commercial banks operating in this environment gained a predictable cost of money in the interbank market. From the lenders' perspective, this level guaranteed the security of loan portfolios, limiting volatility that could have forced sharp changes in margins at lower rates.

However, this approach had a flip side. Consumers counting on quick installment reductions had to adjust their financial plans to a reality where the cost of capital remained high. The lack of drastic changes in November 2024 became the foundation upon which a cautious cycle of cuts was built in subsequent quarters. Every subsequent decision made in 2025 was merely an attempt to balance the needs of borrowers with the necessity of maintaining macroeconomic stability. At that moment, no one assumed that geopolitics would become such an aggressive player in the process of setting interest rates.

Geopolitics as a brake: USA, Iran, and the zloty

July 2026 brought a verification of the optimistic scenarios that appeared in forecasts from the beginning of the year. The escalation of tensions between the USA and Iran, reported by media such as "Parkiet" and "innpoland.pl," became a direct threat to the stability of the Polish currency. When oil prices on world markets began to rise sharply, pressure on the zloty increased to a level that made it impossible for the Monetary Policy Council to continue the path of cuts. A weak zloty means more expensive imports, and in Polish realities – automatically higher inflation.

The mechanism was simple. Geopolitical risk triggered capital flight toward safe havens, which hit emerging market currencies. In this context, any interest rate cut by the RPP would have been interpreted as a sign of weakness. The central bank therefore had to choose between stimulating the economy and defending the purchasing power of money. The July meetings of the Council, reported by wGospodarce, confirmed that in the face of the conflict in the Middle East, priorities had to shift.

Analysts pointed out that bank margins in 2026 ceased to be flexible downward. Banks, observing nervousness in the markets, preferred to maintain higher margins to protect themselves against potential external shocks. The real cost of a loan for a household in mid-2026 was therefore not just a derivative of NBP decisions, but also the result of a risk premium imposed by the banking sector. Borrowers waiting for "cheap money" hit a wall where geopolitics translated directly into the amount of their monthly obligations.

Evolution in 2025: Why didn't installments fall as expected?

The autumn of 2025 was supposed to be a breakthrough. Bankier.pl reported on November 5 about the second autumn quarter-point cut, which gave hope for a clear relief for household budgets. However, as data from the end of the year showed, reality was far from theoretical assumptions. TVN24 in its report from December 28, 2025, pointed out: many loan installments practically did not budge. Why did this happen?

The answer lies in the structure of bank costs and the way banks convert reference rates into interest rates for loan products. An interest rate cut by the RPP is only one piece of the puzzle. Banks, faced with uncertainty about the further path of inflation, were not eager to lower margins. As a result, when the reference rate fell, banks offset this by increasing operating costs or maintaining higher product margins. The borrower, instead of feeling relief, witnessed the stagnation of debt servicing costs.

This process lasted throughout the autumn of 2025. Every subsequent RPP decision, although theoretically beneficial, was consumed by the financial market before it reached the wallets of Poles. Instead of the expected euphoria, disappointment appeared. The banking system behaved defensively, fearing a sharp deterioration in the quality of loan portfolios in the event of a sudden turn in economic policy. Customer expectations diverged from banking mathematics, which created social tension that politicians often could not address in a concrete way.

Forecasts for 2026: Searching for the optimal level

April 2026 brought a series of forecasts that revised earlier hopes for a quick arrival at "cheap money." As reported by Direct Money, forecasts for interest rate levels in 2026 became extremely cautious. Experts began to speak openly about the fact that the cycle of cuts is a long-term process, burdened with a high risk of error. The statement quoted in "Forbes" on November 6, 2025, that we would reach the optimal level at the earliest by the end of 2026, became the main point of reference for all money market analysts.

Reaching the "optimal level" is a term that in economics means a state of equilibrium where inflation is under control and the economy is growing at a pace that does not generate imbalances. In 2026, this level was a moving target. On one hand, pressure for wage growth and consumption forced rates to be kept higher than the market would expect. On the other hand, the slowdown in private investment suggested a need for stimulus.

Analysts in mid-2026 emphasized that the RPP had fallen into a trap. If it cuts rates too quickly, it risks a return of inflation. If it keeps them too high – it will stifle economic growth. Every month of delay in making a decision on deeper cuts was the price paid for past mistakes and the uncertainty resulting from global conflicts. For the average citizen, this meant that 2026 would be a time of "tightening the belt" in the context of loans. There was no talk of returning to the dreams of a cheap mortgage loan, which dominated the public debate just two years earlier.

Financial trap: How bank data verifies optimism

When we analyze data from September 2026, we see a clear dissonance between the messages coming from the RPP and the actual state of the banking sector. Some borrowers, lured by promises of autumn cuts from 2025, invested in new obligations, counting on the cost of money to continue to fall. This turned out to be a financial trap. Increased volatility in global markets caused banks to freeze margins at a level that made it impossible for beneficiaries of the cut cycle to feel a real change.

It is worth looking at the credit spread in 2026. The difference between what the borrower paid and what money cost the bank became significant. Banks increased safety buffers, which meant that the real cost of a loan – including all loan-related fees – was significantly higher than the reference rate alone would suggest. For households whose incomes did not grow as fast as debt servicing costs, this was a signal to limit consumption.

This phenomenon best illustrates how isolated from the real needs of the market decisions made in the quiet offices on Świętokrzyska Street can be. The RPP operates on macroeconomic indicators, while the borrower operates on their account balance. In 2026, these two worlds ceased to intersect. A situation where official interest rate cuts do not translate into lower installments is proof that the financial system in Poland has become extremely sensitive to external factors. Geopolitics, often ignored in credit analyses, turned out to be the most important causal factor.

Summary: Was 5.75 percent the ceiling?

The analysis of events from November 2024 to September 2026 leads to the conclusion that the 5.75 percent reference rate was a key point of reference that set the boundaries for the entire Polish economy. Although in 2025 the Monetary Policy Council made an attempt to break through this level, external geopolitical pressure – from conflicts in the Middle East to exchange rate fluctuations – effectively halted this process.

There is a bitter lesson here for borrowers. The economic cycle is not linear, and promises of quick changes often crash against the hard international reality. In the second half of 2026, it became clear that stabilizing the cost of money is more important than short-term profit for the loan sector. The RPP, by choosing the path of caution, perhaps avoided a wider financial crisis, but the price for this was stagnation in the wallets of Poles.

Looking to the future, it must be acknowledged that returning to the times before 2024 will be a long and arduous process. There is no longer room for over-optimism. Every future decision to cut interest rates will weigh on the zloty exchange rate, which in turn will determine the level of inflation. This is a vicious circle, the exit from which requires not only efficient monetary policy but, above all, a stable international environment. For now, however, 5.75 percent remains a memory that defines the current state of uncertainty.

Questions and answers

Why didn't the RPP cut rates in November 2024 in a more decisive manner?

The Monetary Policy Council decided that in the face of still-smoldering inflation and an unstable macroeconomic situation, the priority was to maintain the currency exchange rate and stabilize the banking sector, which precluded aggressive policy easing.

Why didn't interest rate cuts in 2025 significantly affect loan installment amounts?

Commercial banks, concerned about the uncertain macroeconomic situation and geopolitical risk, kept margins at a high level, which neutralized the positive effect of RPP decisions for the end borrower.

What factors most strongly influenced RPP decisions in 2026?

The most significant factors were geopolitical tensions, especially the US-Iran conflict affecting commodity prices and pressure on the zloty, as well as the need to protect the economy from the effects of exchange rate fluctuations, which forced rates to be kept at a higher level than originally planned.

Did the "Forbes" forecast about the optimal level at the end of 2026 prove accurate?

Everything indicates that it was an extremely accurate diagnosis, as geopolitical turmoil from mid-2026 effectively prevented reaching the interest rate level assumed by the Council, which confirms the difficulties in forecasting the easing path in such a volatile environment.

What does this mean for the average borrower for the second half of 2026?

It means the necessity of maintaining high financial discipline, as the chances for sharp drops in loan installments are minimized by external factors that tie the hands of decision-makers regarding further cuts.

Sources

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