The euro declined to a one-week low against the dollar after a gauge of German business confidence unexpectedly dropped in September, adding to concern the debt crisis is hindering the region’s economy.
Poland’s central bank will cut borrowing costs for the first time since 2009 as the European Union’s biggest eastern economy slows amid the euro-area debt crisis, according to all 35 economists surveyed by Bloomberg.
Poland’s government has been sustaining economic growth by “draining” the country’s reserves and “pumping” borrowed money into the economy, policy maker Zyta Gilowska said in an interview with the magazine “Uwazam, rze.”
Poland shouldn’t accelerate interest-rate increases because inflation is being driven by global prices and tax increases while government budget cuts may hurt economic growth, central banker Zyta Gilowska said.
Poland’s plan to increase the value- added tax next year will reduce consumption and boost inflation, complicating decisions for the central bank’s Monetary Policy Council, Zyta Gilowska , a member the interest-rate setting panel, told the bank’s news service, Obserwatorfinansowy.pl .