- Polish industrial production slowed down sharply in February…
- …however, PMI’s readings still indicate soft landing
On Monday, Central European currencies posted minor gains against the common currency. However, the gains were driven mainly by global factors again.
The EUR/PLN cross rate edged below 4.11 level despite the fact that the figure on industrial production in February showed a slower Y/Y growth than expected (4.6% Y/Y vs. 8.8% Y/Y). However, the IP result was no big surprise as PMI new orders already indicated a slowdown during the second half of last year. Nevertheless, PMI’s also indicate soft landing scenario for the Polish economy, especially in comparison with “crisis years” 2008/2009. Let us also remind that regional figures have shown that the Polish industry have outperformed its peers in recent months as far as the pace of growth is concerned.
Regarding the fresh figure on Hungarian gross wages for January, it showed 4.3% Y/Y growth, i.e. more or less in line with December’s reading excluding bonuses.
As regards the calendar for the rest of the week, it is rather thin. Technically, the room for further CE currency gains seems to be rather limited. Therefore, we expect that the regional currencies might be trading close to current levels waiting for a new impetus. In the meantime, the situation in Hungary concerning the new IMF loan remains the “regional wildcard”.