Yesterday, the Polish central bank did not surprise when it lowered its base rate by 25 basis points to a record low at 2.5%. At the same time the governor Marek Belka announced, that the decision to cut interest rate ends the loosening cycle of monetary policy. NBP has started its monetary easing in November last year and altogether cut its base rate by 2.25 percentage points. Yesterday, the NBP had at its disposal the new inflation forecast, which appeared to be less optimistic than the one form March. According to new NBP estimates the inflation should remain well below its target of 2.5% through this and the next year as well. Also GDP growth projections are currently more pessimistic. Nevertheless the forecast assumes that together with the expected improvement of global economic activity also Polish GDP will gradually accelerate as of the second half of this year. Regarding the current levels of the polish zloty, governor Belka refused to make any comments, since as he said his words are often over interpreted. However, we believe that interventions in FX markets cannot be excluded if the zloty start to ease fast, as NBP showed recently.