Złoty under pressure: tariffs and interest rate cuts hit exchange rate
15:20
Last week saw major turbulence in the currency market, with the Polish złoty among the most affected. According to Ebury analysts, two main factors drove the decline: U.S. President Donald Trump’s announcement of 20% tariffs on European and Asian goods, and a dovish shift by Poland’s central bank. The tariffs hit Poland’s open economy hard, triggering capital outflows and pushing EUR/PLN above 4.30.
Investors are now pricing in potential rate cuts of up to 200 basis points in 2025. Globally, risk-sensitive currencies weakened amid recession fears, while safe-haven currencies like the Swiss franc and Japanese yen gained. This week, U.S. inflation data and developments around trade tariffs will be key market drivers.
