A mixed session for the Polish zloty on Wednesday

A mixed session for the Polish zloty on Wednesday. The EUR/PLN got off to a reasonably strong start of the day and the pair was seen testing bids at 4.02, but with bears back on the marketplace throughout the region and political worries slowly intensifying as Samoobrona threatened to opt out of the ruling coalition, the zloty gave back all of its gains and eventually ended the day down around 0.5% against the euro. The drop would have probably been even deeper though if not for the Slovak central bank intervention, which forced sellers in the region to make a step backward just before the end of trade.

With a first piece of macro data to be released today and the government confidence vote pushed forward in time till next week, the market will probably take its mind off politics today. We would look for a gently softer than expected C/A reading but unless the release shows a significant deviation from the market consensus, the zloty should take the numbers in its stride. Meanwhile, softer global risk appetite again weighs on emerging markets, so we could see some additional PLN selling ahead of the weekend.

(CSOB - Investment research)