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Poland's central bank has kept its benchmark interest rate steady at 4%, pausing its monetary easing cycle for a second consecutive month as the economy shows signs of unexpectedly strong growth.

The decision by the Monetary Policy Council on Wednesday was anticipated by most analysts, with 19 out of 32 economists surveyed by Bloomberg forecasting the hold. The remainder had predicted a quarter-point rate cut.

Strong Growth Triggers Policy Pause

The central bank is taking a wait-and-see approach after implementing 175 basis points of rate cuts over 2025. The council signaled last month that it needed more time to evaluate the effects of that easing, a stance reinforced by new economic data.

A report last week revealed that Poland's $1 trillion economy expanded by 3.6% in 2025, a figure that surpassed economists' expectations. This robust performance is a key factor behind the decision to hold rates steady rather than risk fueling further economic momentum with another cut.

Inflation Remains Just Below Target

Despite the strong growth, inflation remains contained. The inflation rate stood at 2.4% in December, slightly below the central bank's official target of 2.5%.

This balanced environment—strong growth paired with managed inflation—gives policymakers room to hold their current position. Governor Adam Glapinski has indicated that while there is little room left for additional rate cuts, he does not foresee significant inflation pressure on the horizon following the recent period of tight monetary policy.

Market participants will now look for more detailed guidance. The central bank is scheduled to release a formal statement at 4 p.m. in Warsaw, and Governor Glapinski will hold his monthly press conference at 3 p.m. on Thursday.

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Source: investinglive

U.S. President Donald Trump announced a significant "trade deal" with India on February 2 via a post on Truth Social. According to Trump, the agreement reduces the reciprocal tariff on Indian goods from 25% to 18%, a decision he said was made at the request of Indian Prime Minister Narendra Modi and out of "friendship and respect."

Trump's post included several major claims about India's commitments:

• An agreement to stop buying Russian oil.

• A pledge to purchase "much more" oil from the U.S. and "potentially" Venezuela.

• A promise to eliminate all existing tariff and non-tariff barriers.

• An agreement to buy over $500 billion in American goods across energy, technology, and coal sectors.

Prime Minister Modi confirmed his conversation with his "dear friend" Trump on X. However, his statement was far more limited. Modi only mentioned that "Made in India" products would now face a "reduced tariff" of 18% and expressed support for Trump's global efforts. He made no mention of commitments regarding Russian oil or the elimination of tariffs on U.S. goods.

Officials Scramble to Clarify the Deal

The discrepancy between the two leaders' announcements has created confusion, with officials on both sides suggesting the deal is not yet finalized.

A day after the announcements, India's Commerce Minister Piyush Goyal stated that the final details are still being "worked out" and that a joint statement is expected "shortly" once "technical details" are confirmed.

His American counterpart, U.S. Trade Representative Jamieson Greer, echoed this, noting that the paperwork has yet to be finalized but conceding that the "specifics and details" of the agreement have been defined. Citing government sources, the Asian News International (ANI) agency reported that a joint statement would likely be issued "this week."

Just before Trump's announcement, India's Commerce Secretary Rajesh Agrawal, the former chief negotiator for the bilateral trade agreement, remarked that talks were "progressing well" but that a "larger bilateral trade agreement" is complex and "will take time."

It appears the two nations have agreed on a framework to address the reciprocal tariff issue. While this is being called a trade deal, it stops short of a comprehensive free trade agreement that would resolve all outstanding points of friction.

The Sticking Point: Agriculture and Market Access

A key area of disagreement appears to be market access for U.S. agricultural products.

Goyal reassured the Indian public that the country's sensitive sectors, particularly agriculture and dairy, have been protected. In stark contrast, Greer said India had agreed to reduce tariffs for the U.S. on "a variety" of goods, including agricultural products.

Previously, Greer had described India as a "tough nut to crack" regarding its protected farm sector but noted that the offers made during the latest negotiations were the "best the U.S. has ever received." U.S. Secretary of Agriculture Brooke Rollins also announced on social media that the deal would allow more American farm products to be exported to India. Citing an anonymous government source, Reuters reported that India has agreed to partially open its agriculture sector.

The Russian Oil Connection

Uncertainty also surrounds the status of a 25% punitive tariff announced by the U.S. on August 6 as a penalty for India's continued purchases of Russian oil.

U.S. Ambassador to India, Sergio Gor, confirmed that the total tariff on India will be 18%, which suggests the punitive tariff has been revoked. However, some Indian media outlets, citing White House sources, report that the revocation is conditional on India completely halting all imports of Russian oil, not just reducing them.

Meanwhile, the Kremlin has stated it has not received any information from New Delhi regarding plans to stop buying its oil.

India's Shifting Energy Sources

India has already been diversifying its oil imports. Russia's share of India's oil imports fell to its lowest level in two years in December 2025. According to the Economic Survey 2025–26, U.S. crude accounted for 8.1% of India's oil imports between April and November 2025, up from 4–5% in the same period a year earlier.

Imports from the UAE, Nigeria, Libya, Egypt, Brazil, and Brunei have also increased. While imports from Venezuela dropped during this period, they are expected to rise following Trump's statement.

However, credit rating agency Moody's has warned that an immediate and complete halt of Russian oil imports could disrupt India's economic growth and fuel inflation. It is likely India will continue to reduce its reliance on Russian oil, but a complete stop, as claimed by Trump, presents a significant challenge.

A Major Win for India, But at What Cost?

Securing an 18% reciprocal tariff is a major achievement for New Delhi. This rate is one of the lowest among major Asian economies, trailing only Japan's 15%, and gives Indian exports a significant competitive advantage in the U.S. market.

The central question, however, is what India conceded to get this deal. Until the final details are released, any assessment of the agreement's net benefit to the Indian economy remains premature.

The timing of the announcement, just days after an India-EU Free Trade Agreement was unveiled, is telling. The pact with the EU was seen as a signal to the U.S. that its partners would not bow to threats of tariff wars. This new development indicates Washington has become more willing to accommodate India's demands, even as negotiations on contentious issues continue.

Once the fine print is public, it will be clear whether the U.S. accommodated India's sensitivities on market access, particularly in agriculture. For now, the announcement has likely paused the recent downward trend in bilateral relations and created space to rebuild trust.

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Source: fxempire

Chinese President Xi Jinping and his Russian counterpart Vladimir Putin reaffirmed their strategic partnership on Wednesday, hailing their deepening alliance as a key stabilizing force in an increasingly turbulent world.

In a video call, both leaders underscored their commitment to a united front against the West, building on ties that have grown closer since Russia's 2022 offensive in Ukraine. The discussion followed recent meetings between top officials from both nations, who agreed that their relationship could "break new ground" this year through expanded economic cooperation.

Figure 1: Russian President Vladimir Putin greets his Chinese counterpart Xi Jinping during a video conference, reinforcing the strategic partnership between Moscow and Beijing.

Xi told Putin that the international situation has become more turbulent since the start of the year. According to Chinese state broadcaster CCTV, Xi called for "deeper strategic coordination" to ensure that China-Russia relations "continue to develop steadily along the right track."

Addressing Xi as his "dear friend," Putin echoed the sentiment, stating that "the foreign policy alliance between Moscow and Beijing remains an important stabilizing factor." He described their comprehensive partnership as "exemplary," though neither leader specified the exact areas where they would increase coordination.

Economic Pivot and Strategic Silence on Ukraine

Putin praised the strong trade ties between the two countries, which have become crucial for Moscow as it redirects exports toward Asia. This economic pivot is a direct response to the massive sanctions imposed by Western nations following the Kremlin's military actions in Ukraine.

China has consistently avoided denouncing Russia's military campaign and has not called for a withdrawal of troops, a position that many of Ukraine's allies view as tacit support for Moscow.

The video conference occurred as Russian, Ukrainian, and U.S. negotiators were meeting in Abu Dhabi for another round of talks aimed at ending the conflict. However, Putin made no reference to Ukraine during his call with Xi.

Figure 2: The leaders' video call is broadcast on a public screen in Beijing, underscoring the high-profile nature of the China-Russia relationship.

This high-level communication follows several in-person meetings. The two leaders last met in September when Putin attended a military parade in Beijing. Xi had also visited Moscow in May of last year for Russia's World War II victory celebrations. More recently, on Sunday, China's Foreign Minister Wang Yi met with Russia's security chief Sergei Shoigu in Beijing, where Wang stressed the need to jointly uphold multilateralism and "advocate for an equal and orderly multipolar world."

China's Diplomatic Push and UN Commitment

The call with Putin is part of a broader diplomatic effort by Xi to consolidate international support, particularly as China navigates its relationship with an increasingly unpredictable United States.

During the discussion, Xi reiterated his commitment to the international system centered around the United Nations, where China holds a permanent, veto-wielding seat on the Security Council. This emphasis on the UN has been a consistent theme in his recent talks with leaders from France, Canada, Britain, and Brazil.

This focus comes after U.S. President Donald Trump announced plans in January for a "Board of Peace," raising concerns that Washington may seek to create an alternative to the United Nations.

Even while engaging with the UN, Beijing has pushed back against what it considers internal interference. It has also worked to position itself as a stable global partner, hosting Western leaders and U.S. allies who have been unsettled by Trump's policies, such as his tariff threats and his bid to acquire Greenland. In recent weeks, leaders from France, Canada, Finland, and Uruguay have all made visits to Beijing.

Source: Bloomberg