Currency report: Złoty squares up to euro
The zł.4 level on the EUR/PLN pair was tested but not broken. The main event that will move the złoty and Polish debt market next week is the Monetary Policy Council's (RPP) meeting. It is expected to cut interest rates by 25 basis points. Such a cut is already priced into the debt market. Decreasing spreads between German euro and Polish złoty bonds could cause some profit taking after the decision and limit the upward potential of Polish bond prices, which beat recent tops and is continuing to climb. GUS released last week retail sales and unemployment figures for May. Both indicators were pleasant surprises, with sales rising eight percent year-on-year.
The recent EUR/USD downtrend showed that the złoty is very strong. It was stable to the dollar and gained on the euro in moments of a huge euro sell-off. This shows that even in the event of a continuation of the EUR/USD downtrend, the złoty will remain very strong.
Marcin Golik
WGI Dom Maklerski
The recent EUR/USD downtrend showed that the złoty is very strong. It was stable to the dollar and gained on the euro in moments of a huge euro sell-off. This shows that even in the event of a continuation of the EUR/USD downtrend, the złoty will remain very strong.
Marcin Golik
WGI Dom Maklerski
