There is a continued space for further interest rate cuts, National Bank of Poland (NBP) president and rate council head Marek Belka told the Financial Times in December in an interview published on January 6.

"We see a change in approach on the part of the monetary policy council (RPP) and a deepening conviction that there is a continued space for further cuts," Belka said.

At the same time, the central bank governor prefers a "conventional" monetary policy without ultra-low interest rates and hopes that slowing pace of fiscal tightening will offer some "breathing room" for the economy.

"We would like to retain what we think is very valuable, that our monetary policy is still conventional, that we do not have to move to ultra-low interest rate levels," he said.

"We are not encouraging the finance ministry to further excessive fiscal consolidation at this time,” he said.

According to the NBP governor, 2013 will be difficult, but the economy will start to revive during the year.

Poland's rate council opened an easing cycle with a 25 bps cut in November, followed by another 25 bps cut in December to put the reference rate at 4.25%. Polish bank analysts unanimously expect another 25 bps cut in January.