PLN: Zloty Comes Under Renewed Pressure
Local assets have ignored hawkish talk from Polish MPC member, with the zloty losing ground to become the second-worst performer in the EMEA space. EUR/PLN deals at 4.3657, up 166 pips on the session, with topside focus falling on Nov 6, 2024 high of 4.3758 and Jun 14, 2024 high of 4.3826. Conversely, bears look for a pullback towards the 50-EMA at 4.3219. * MPC's Kotecki said that the central bank may be forced to raise interest rates if the November projection shows that the anticipated upswing in inflation is bound to be persistent. During his presser earlier this month, Governor Glapiski guided that a period of flat rates was more likely, and most MPC members seemed to concur. * A couple of rate-setters flagged concern about the looming retirement of an NBP Management Board member on November 4, at which point the number of people on the panel would drop below the statutory minimum, creating legal risks. Political deadlock between the President and Prime Minister over filling the vacancies has so far proven impossible to break. * Political impasse has also raised the risk of a failure to address the spike in energy prices, as President Nawrocki called the government's windfall
Local assets have ignored hawkish talk from Polish MPC member, with the zloty losing ground to become the second-worst performer in the EMEA space. 3826. 3219. * MPC's Kotecki said that the central bank may be forced to raise interest rates if the November projection shows that the anticipated upswing in inflation is bound to be persistent.
During his presser earlier this month, Governor Glapiski guided that a period of flat rates was more likely, and most MPC members seemed to concur. * A couple of rate-setters flagged concern about the looming retirement of an NBP Management Board member on November 4, at which point the number of people on the panel would drop below the statutory minimum, creating legal risks. Political deadlock between the President and Prime Minister over filling the vacancies has so far proven impossible to break.
* Political impasse has also raised the risk of a failure to address the spike in energy prices, as President Nawrocki called the government's windfall-tax bill tabled to finance relief measures 'unconstitutional'. Nawrocki suggested he would not sign the bill and called on the government to consider his counterproposal. 88 times the amount on offer. 08x.
* The FI space has been unfazed by the auction, as market participants continue to digest NBP speak and monitor updates on US-Iran talks and the evolution of the geopolitical situation in the Middle East. POLGB yields are still marginally mixed. Polish 3x6 FRAs sit 30bp above 3-month WIBOR. 5%.