Despite the all-in-all positive shift in regional
sentiment the Polish zloty hit a soft patch
early Monday morning as profit taking kicked
in after a successful session on Friday. The
EUR/PLN pair started the day off in the 4.03
area and it wasn’t long before the single
currency was seen testing bids at 4.0450. By
noon zloty bulls had returned to the market
but with market activity at holiday levels they
found it hard to push the pair past the 4.04
mark.
Regarding today’s trading all will be up to
whether the upbeat sentiment in the region
holds, hence the ZEW index release and the
US PPI numbers will get most of the
market’s attention. A higher than expected
reading in either of these would mean bad
news for the zloty, nonetheless even so we
are fairly certain that the EUR/PLN pair will
find ample resistance in the 4.05-4.06 area
today, as the most relevant data (the Polish
industrial output figures and the US CPI, as
well as Bernanke’s testimony) are still to
come.
(CSOB - Investment research)