Currency report: Euro hit by politics
The euro lost three cents against the greenback and found some ground below the $1.22 level. The European currency was at its cheapest level since September 2004.
The złoty behaved relatively strong to the dollar and gained on the euro. All this happened along with bad GDP figures for QI 2005. The Polish economy grew by 2.1 percent, whereas a figure of 2.9 percent was expected. Investments grew by one percent, much slower than 7.2 percent a month ago. The złoty was hit by the news but recovered sharply after breaking above the zł.3.40 level for few hours. With a slowing economy and inflation under control, interest-rate cuts are expected. The bond market reacted very positively to the changed expectations; the yields on all curves fell below previous levels.
The złoty is behaving very strongly relative to the euro. The week ended the EUR/PLN pair close to two-month lows. The uncertainty about the eurozone's future strengthens not only currencies of the "old" EU members who are not in the eurozone, but also currencies such as the złoty.
Marcin Golik
WGI Dom Maklerski
The złoty behaved relatively strong to the dollar and gained on the euro. All this happened along with bad GDP figures for QI 2005. The Polish economy grew by 2.1 percent, whereas a figure of 2.9 percent was expected. Investments grew by one percent, much slower than 7.2 percent a month ago. The złoty was hit by the news but recovered sharply after breaking above the zł.3.40 level for few hours. With a slowing economy and inflation under control, interest-rate cuts are expected. The bond market reacted very positively to the changed expectations; the yields on all curves fell below previous levels.
The złoty is behaving very strongly relative to the euro. The week ended the EUR/PLN pair close to two-month lows. The uncertainty about the eurozone's future strengthens not only currencies of the "old" EU members who are not in the eurozone, but also currencies such as the złoty.
Marcin Golik
WGI Dom Maklerski
