On 28 May 2020. the Monetary Policy Council (hereinafter referred to as the MPC), by Resolution No. 7/2020 of the Monetary Policy Council of 28 May 2020 on the reference rate, interest rate on refinancing loans, term deposit interest rate and the rediscount rate and discount rate on bills of exchange with the National Bank of Poland, once again reduced the reference rate to 0.1% on an annual basis (reduction by 0.4% percentage point).

The previous change of NBP interest rates took place on 8 April (with effect from 9 April), an even earlier one (the first one in over 5 years) took place on 17 March (with effect from 18 March).

It should be pointed out that the recent interest rate cuts (reference, as well as pawn shop, rediscount, deposit, rediscount bills of exchange, discounted bills of exchange) brought interest rates down to a historical minimum.

As indicated in the MPC post-May 28, 2020 communication, the aim of reducing interest rates is to limit the negative effects of the pandemic in order to reduce the scale of the fall in household and corporate income as well as to stimulate the economic situation.

For related parties, this means that loans granted within capital groups must not exceed 7.2% per year.

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Author: Beata Rawa – Transfer Pricing Manager

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