Zloty hits 40-month low against euro

The zloty hit a 40-month low to the euro in late trade yesterday which dealers attributed to stop-loss deals by foreign players worried by a possible war on Iraq and local politics, but treasury bonds remained strong. The volatile zloty, depressed by Iraq worries and morning comments by Premier Leszek Miller, was 1% weaker to the euro and 0.7% to the dollar in late afternoon trading, shrugging off the IMF's assessment of the country's economy. Analysts doubt Miller could muster the necessary two-thirds majority in parliament to change the monetary policy regime, but said his comments raised concerns about possible policy switches as his minority government seeks allies in parliament. "The fall of the zloty was triggered by an early large sell order from London, which sparked stop-losses and continued to push the market down throughout the session," said a dealer at BRE Bank. (Reuters) A.Z.