Interest rates in 2026: are further cuts ahead?

In brief

In July 2026, the Monetary Policy Council (MPC) decided to keep interest rates unchanged.
PIE experts emphasize that the escalation of the conflict in the Middle East remains a key risk factor for monetary policy.
According to economist forecasts from November 2025, the economy has a chance to reach the optimal interest rate level no sooner than the end of 2026.

The MPC's stance in July 2026: stabilization or waiting?

During its meeting on July 8, 2026, the Monetary Policy Council decided to keep interest rates unchanged. For the market, which has been analyzing every statement from the NBP for months, this move came as no surprise. Council members adopted a clear wait-and-see strategy, while avoiding any signals suggesting the need for immediate hikes. Despite the clear uncertainty accompanying the economy in the middle of the year, policymakers concluded that current conditions do not require a drastic reaction.

However, many observers are asking how long this state can last. Experts from the Polish Economic Institute (PIE) clearly indicate that the Council's future decisions are directly dependent on the development of the geopolitical situation in the Middle East. Any potential escalation in this region could drastically change the outlook for domestic monetary policy, affecting energy commodity prices and, consequently, the path of inflation. This unpredictability effectively ties the hands of policymakers.

The prospect of reaching the optimal interest rate level is being pushed further into the future. Economic analyses suggest that real changes are possible no sooner than the end of 2026. For borrowers, this means one thing: a complete freeze on expectations for cheaper money in the coming months. The stabilization we are observing is more of a safety measure than a signal for optimism. The market must come to terms with the fact that Polish monetary policy has largely become a hostage to events over which the National Bank of Poland has no real influence. Businesses and households should therefore prepare for a further period of waiting, as a quick return to a cycle of cuts currently seems an unlikely scenario.

The evolution of monetary policy since November 2024

The current stabilization of interest rates is not accidental; it is rather the result of a cautious withdrawal from the restrictive course that had been in place for many months. The reference point for all analyses remains November 2024, when the reference rate was 5.75 percent. Since then, the Monetary Policy Council has moved at a pace that, for many borrowers, was too slow to realistically feel relief in household budgets.

The most significant move in this cycle occurred on November 5, 2025. Bankier.pl noted at that time the second autumn quarter-point cut, which gave hope for faster monetary policy easing in subsequent quarters. However, the end of 2025 brought disappointment – even though rates were going down, for many loan holders, installments remained virtually unchanged. The market reacted with reserve, realizing that a technical decision alone is not enough to stimulate the economy.

Today, the MPC is keeping rates at an unchanged level, and the narrative of Council members has clearly turned toward a defensive stance. The optimism from a year ago has faded. An economist quoted by "Forbes" already pointed out in November 2025 that we would reach the optimal level at the earliest by the end of 2026. This scenario remains current, but with one significant caveat.

Everything depends on geopolitics. As PIE analysts emphasize, future decisions will be determined by the situation in the Middle East. Any escalation of the conflict in this region could brutally interrupt the process of easing monetary policy, forcing the MPC to freeze current rates for longer or even to tighten policy again. Investors must prepare for a scenario in which stability becomes a luxury, not a standard.

The influence of external factors on NBP decisions

The Monetary Policy Council remains adamant. Despite market expectations, interest rates in Poland remain at their current, unchanged level. Policymakers are not making sudden moves, and the reasons for this caution go far beyond our own backyard. Warsaw is closely watching the Middle East.

The dependency is simple, though brutal. The July analysis by the Polish Economic Institute clearly indicates: the key risk factor remains the potential escalation of the conflict in this region. This is not just a matter of politics; it is pure economic mathematics. Every worsening of the situation translates into a real threat of rising energy commodity prices. More expensive oil or gas is an immediate pro-inflationary impulse that forces the central bank to keep the cost of money in check. The MPC cannot afford to loosen monetary policy when the specter of another supply shock looms on the horizon.

Experts are therefore cooling the enthusiasm of those who counted on quick and cheap loans. Already last year, economists, such as those quoted by "Forbes," pointed out that the path to the so-called optimal level is long. The realistic scenario assumes reaching this level no sooner than the end of 2026. Provided, of course, that the international situation does not spiral out of control.

For the average borrower, this means a state of suspension. The NBP is stalling, waiting for sentiment in commodity markets to calm down. As long as global geopolitics generate such high uncertainty, the chances for significant interest rate cuts in the coming months remain illusory. Stabilization, not easing – this is currently the only certain point of the Council's strategy. Waiting for a breakthrough is turning into a test of patience.

Borrowers and changes in market indicators

The Monetary Policy Council is keeping interest rates unchanged, thereby freezing the hopes of many Poles for a quick drop in monthly burdens. The market situation remains complex, and analysts agree: reaching the optimal level as soon as possible will only happen at the end of 2026. However, this scenario has one major condition – provided that the situation in the Middle East does not escalate further, which could force policymakers into a completely different strategy.

For holders of long-term debt, the current stabilization means remaining in uncertainty. The market has already painfully learned that MPC decisions do not always translate into an automatic drop in installments in our wallets. This was perfectly demonstrated by the events of December 28, 2025. Although rates were officially cut then, a significant portion of borrowers felt no relief – their installments simply did not budge. Banks, hedging against volatility, did not always correlate their offers with the MPC's move at the pace expected by customers.

The current stagnation puts borrowers in a difficult position:

Stabilization of rates at the current level means that the cost of servicing debt remains at a high, predictable, but still burdensome level.
The lack of clear signals for further, aggressive cuts forces households to maintain budget reserves instead of planning larger consumer expenditures.
The risk of conflict escalation in the Middle East hangs over MPC decisions like a sword of Damocles, making any "cheap loan" forecasts highly uncertain.

For the average borrower, this means that real savings will take at least a few quarters to materialize. The optimism from the autumn cuts of 2025 has faded, giving way to hard calculation. Today's monetary policy is not a time for quick profits for debtors, but a period of defensive capital management, where every move depends on external factors over which the Polish market has no influence.

Economist forecasts for the end of 2026

The Monetary Policy Council remains adamant. The September meeting confirmed that we can forget about quick monetary policy easing in the near future. Interest rates remain in suspension, and the loan market must get used to stabilization at the current level. Hopes for a quick return to cheap money are being shelved.

Experts long ago corrected their optimistic assumptions. Back in November 2025, Forbes forecasts suggested that reaching the optimal interest rate level was realistic only at the end of 2026. Today, looking at data from April 2026, it is clear how much uncertainty has increased in forecasting the interest rate path. Analytical models that gave clear signals just a few months ago are now generating conflicting messages.

Everything boils down to geopolitics. As long as the situation in the Middle East does not escalate further, the scenario assuming reaching optimal parameters at the end of the year remains on the table. However, every subsequent impulse in that region is a risk of breaking this plan. The central bank cannot afford a mistake, especially when inflation remains a hostage to energy prices and global market instability. For borrowers, this means one thing: the waiting period is extending. Instead of cuts, we must count on maintaining current debt costs for the coming months. There is no room for bold moves when the international situation remains so tense. The market must prepare for a conservative variant, in which stabilization wins over haste.

Summary: what should Poles prepare for?

The Monetary Policy Council remains in wait-and-see mode, which means that interest rates in Poland remain at an unchanged level. From the perspective of a household budget, this is a signal not to count on a quick breather in the mortgage repayment schedule. Analysts agree: reaching the optimal cost of money is possible no sooner than the end of 2026. However, this scenario is not set in stone.

Everything depends on geopolitics. The situation in the Middle East remains the main variable that could overturn existing economic forecasts. Even a small escalation of the conflict in this region could force the MPC to change its rhetoric, and in an extreme case – to tighten monetary policy again. This is not the time for optimistic assumptions in household spreadsheets.

I recommend extreme caution in budget forecasts. The cycle of changes in monetary policy is still ongoing, and the market reacts nervously to every signal from the outside. When planning expenses for the coming months, be sure to monitor NBP announcements. That is where the real clues regarding the future interest rates of your liabilities are hidden, not in campaign promises or optimistic bank reports. Current stabilization is not the end of the game, but merely a pause in an uncertain cycle that requires attention and flexibility from borrowers. If you have a variable-rate loan, a safer strategy remains treating the current cost of debt as the baseline, without assuming sharp drops in installments in the short term. In the face of global tensions, calm financial planning is the only reasonable approach.

What this means for you

For the average borrower, this means a time of stabilization, but not necessarily quick relief in the household budget. A person with savings gains if rates remain higher for longer, while borrowers must arm themselves with patience, waiting for signals from the Middle East that directly affect MPC decisions.

Questions and answers

Will interest rates fall in the near future?

In July 2026, the MPC kept rates unchanged, and economists suggest that we will only approach the optimal level toward the end of the year.

How does the conflict in the Middle East affect my installments?

According to PIE, the escalation of this conflict may force the MPC to be cautious with cuts, which translates into maintaining higher loan costs.

Are the decisions from November 2024 still relevant?

Yes, the 5.75 percent level from November 2024 serves as a reference point for the entire cycle of changes we are observing in 2025 and 2026.

Sources

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