Currency report: Złoty continues to weaken

 The decision was widely expected and we didn't see much movement of the major currencies with regard to the ECB's decision.

The złoty continued to weaken despite the fact that no important fundamental data was published this week. The fall is attributed mainly to the situation on the global markets.

The strengthening of the dollar, and increasing risk aversion are weakening the Polish złoty. This situation is well observed in the EUR/PLN and USD/PLN rates. The EUR/PLN started the week at zł.3.7904 and was already quoted at zł.3.8510 on Friday. The USD/PLN was quoted on Monday at zł.2.8187 but gained value during the week to reach zł.2.8877 on Friday.

The EUR/USD reached its lowest level since April on Friday. The obvious strengthening of the dollar is due to the rising market interest rates in the US, which are getting close to its high of 5.24 percent from June 2006. The EUR/USD opened on Monday at $1.3443, reaching $1.3518 on Wednesday, but it tumbled to $1.3337 on Friday.

Adam Narczewski, X-Trade Brokers Dom Maklerski SA