Złoty bows to the dollar
Opinion polls indicate that Law and Justice (PiS), which currently can count on 24 percent of votes, would take the helm in the general election. T Civic Platform (PO), can count on 20 percent of votes. The result of the poll had no immediate effect on the market, which reacted more strongly to events on the Euro/Dollar market and demand on Polish debt.
The 10-year bond auction last week showed a very low coverage ratio and not all the offered bonds have been sold. This left negative sentiment on the longer duration sector further weakening the złoty. The main factor behind the two percent slide in PLN/USD was not an internal factor. The euro lost two cents relative to dollar in ForEx market due to higher inflationary expectations in the US and a rise in interest rates. The macroeconomic figures last week showed slipping sales but the dollar remained strong.
Marcin Golik, Warsaw Investment Group (WGI)
The 10-year bond auction last week showed a very low coverage ratio and not all the offered bonds have been sold. This left negative sentiment on the longer duration sector further weakening the złoty. The main factor behind the two percent slide in PLN/USD was not an internal factor. The euro lost two cents relative to dollar in ForEx market due to higher inflationary expectations in the US and a rise in interest rates. The macroeconomic figures last week showed slipping sales but the dollar remained strong.
Marcin Golik, Warsaw Investment Group (WGI)
