Analysts: upbeat data and rate cut hopes to lead to stronger zloty in short term

The zloty is expected to remain bullish in the near term amid more optimistic economic data and hopes for rate cuts in the offing, analysts said. Better-than-expected December current account data, positive C/A forecasts for end-2001, and hopes that interest rates will soon be cut are expected to continue to boost the currency, which on Friday already reached near record-highs to the euro (3.778) and 10-month highs to the U.S. dollar (4.0325). Investors will now have to wait for Wednesday's release of January food price data, the most volatile component of the consumer price index (CPI) basket, to see whether or not the government's upbeat January CPI forecasts are on the mark. Poland's Monetary Policy Council (KPP) is expected to cut interest rates by some 100 to 200 basis points later in the first quarter as inflation falls. Official rates currently stand at between 19% and 23%.(Reuters)