15:20 8 April 2025
Złoty under pressure: tariffs and interest rate cuts hit exchange rate
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.
