Currency report: RPP raises rates

The decision was made due to the RPP's opinion that the probability that inflation would increase above the the inflation target was higher than the probability that inflation would decrease below the target. Finance Minister Zyta Gilowska stated that the decision was not a good one, and that inflation was high due to the large increase in the prices of food and energy.

Wednesday also produced good information for the złoty regarding retail sales, which increased by 19.2 percent against an expected 17.8 percent, and the publication of the unemployment rate, by the Central Statistical Office (GUS), which fell, as expected, from 14.9 percent to 14.4 percent. The strength of the złoty could be observed on the USD/PLN market which is quoted at zł.2.76, and the EUR/PLN market which is quoted at zł.3.77.

Home sales in the US increased by just 2.6 percent versus an expected 4.4 percent, which proved to be the nail in the coffin for the economy.

Omar Arnaout X-Trade Brokers Dom Maklerski SA