Currency report: Złoty loses ground

On Thursday in the evening the EUR/PLN cross rose to a four-month high at zł.3.945 and the dollar reached its highest level since November 2006 at zł.3.057. 

Poland's złoty deepened losses against the euro, and the dollar was hit by weakened sentiment towards central European currencies. The złoty hit a key technical level at zł.3.91 for the EUR/PLN in off-session trading late on Thursday, triggering a series of automatic sell orders that pushed the currency to almost a four-month low, but it rebounded to trade up more than half a percent on Friday. International investors decided on profit taking when the interest rate premium against eurozone rates shrank in Poland to half a percent.

On the international market, the dollar gained against the single currency but it did not break key levels. Next week investors will be looking at a slew of US data, including payrolls and PCE inflation, as well as the Federal Reserve's latest policy decision.

Marek Węgrzanowski

X-Trade Brokers Dom Maklerski SA