Currency report: Złoty cautiously eyes the dollar

 On Friday, the power of the złoty could especially be seen on the USD/PLN market, which plummeted to a record low, breaking the 2.8401 level. Some crucial information that could have influence on the Polish currency in the future is last Friday's publishing of the CPI index, which showed an unexpected rise to the level of 2.5 percent, meaning an interest-rate hike may be necessary in the near future.

The dollar was slightly weakened, and awaited more relevant information on Friday. Last Wednesday the highly awaited minutes of the March Federal Open Market Committee (FOMC) meeting were released, which highlighted the problem of inflation once more and signified that interest rates may have to be increased.

Regardless, Friday's information seemed most meaningful. Prices paid to producers (PPI) in the US rose one percent in March which could cause an additional spark to inflation, while the trade balance fell to -$58.4 (-zł.166.4) billion, with import and export facing a decrease.

Omar Arnaout X-Trade Brokers Dom Maklerski SA