Polish governor says dissenting MPC members may have broken law

Glapiński and four colleagues could notify prosecutors over critical comments by fellow rate-setters
Adam Glapiński
NBP governor Adam Glapiński

Poland’s central bank governor Adam Glapiński and four more monetary policy council members have accused two colleagues of potentially committing a crime by criticising them.

The statement today (October 11) by Glapiński and other MPC members did not name their colleagues, but it follows criticisms by Przemyslaw Litwiniuk and Joanna Tyrowicz.

The MPC decided to hold Poland’s policy rate at 6.75% on October 5, after hiking it for 11 consecutive meetings. The rate hold came as a surprise to analysts, who had predicted a 25bp increase. Year-on-year inflation reached 17.2% in September, its highest level for 26 years, well above the NBP target of 2.5%, plus or minus one percentage point.

Afterwards, Tyrowicz and Litwiniuk hinted they disagreed with the decision, apparently prompting the governor’s claim that they might have broken the law.

“We do not accept and express our extreme disapproval of actions which, in our opinion, may constitute a violation of the aforementioned provisions of the law,” Glapiński and his colleagues said today. “Therefore, we consider it justified to consider sending a notification of a suspected crime in this case.”

The statement may mean that Glapinski could formally ask prosecutors to investigate the two MPC members, as he did in an earlier case involving a Polish politician. The National Bank of Poland did not respond to a request for comment.

Glapiński has formally asked Poland’s chief prosecutor to investigate his critics in the past. In July, the governor demanded the public prosecutor investigate Donald Tusk, the leader of Poland’s main opposition party, for having made negative remarks about him. The next month, Glapiński accused Germany of wanting to take control of some Polish territory.

Critical comments

After the MPC meeting, Litwiniuk said on television there was a strong argument that the council should have continued with increases, rather than pausing them. He also said the MPC should not cut rates before Poland’s general election, due by the autumn of 2023, Biznes Wprost reported.

If the MPC did cut rates before then, it was because its interests were aligned with the government, Litwiniuk said. People could see that the zloty was weakening, he added.

Tyrowicz told Polish media outlet Gazeta.pl: “As an economist, I haven’t understood the decisions made by the MPC for a very long time.” She later used LinkedIn to post a marked-up version of the NBP’s monetary policy statement on October 9.

The two MPC members’ comments appear to have led to the governor’s statement today. Litwiniuk mocked the governor’s statement, telling media it was written in the language of a government propaganda newspaper published under Communist rule.

Five of the MPC’s current eight members signed the statement, with Cezary Kochalski, Wieslaw Janczyk, Ireneusz Dabrowski and Henryk Wnorowski joining Glapiński. All five signatories have been nominated by the government, with some opposition politicians accusing them of acting out of party loyalty.

As well as Litwiniuk and Tyrowicz, Ludwik Kotecki, former deputy finance minister in a government led by Tusk, did not sign the statement. Both of the dissenting MPC members were nominated by Poland’s senate, which is controlled by opposition parties.

Tyrowicz is an economics professor at the University of Warsaw. Litwiniuk is a professor of law at the Warsaw University of Life Sciences, and has also worked as a local government politician.

The zloty has fallen by more than 26% against the dollar over the past year. It fell again after the October 5 decision, to trade at 5.00 to the dollar today.

New MPC members confirmed

Eight members currently serve on the NBP’s monetary policy council, but on October 6, the Sejm, the lower house of Poland’s parliament, confirmed two new members. Iwona Duda and Gabriela Maslowska, both nominated by the government, will take up vacancies created by one member resigning early and another reaching the end of their term.

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