Polish złoty may stay under pressure until Turkish lira exchange rate stabilizes. However, EUR/PLN should not rise significantly above PLN 4.30, according to BZ WBK economists. US dollar may also weight on PLN and Polish bonds.
Both Russian rouble and Turkish lira were under strong pressure last week due to worsening of relationships with the USA. USD/TRY rate rose to the record level, raising concerns that tensions in the Turkish economy may spread to other markets.