The Polish zloty inched down to EUR/PLN
3.89 as profit taking extended from Friday
onto Monday morning, before easing back
into the 3.88 area later in the day. Trading
was thin though, ahead of the All Saints Day
on Wednesday and should remain that way
at least until Thursday’s ECB decision on
rates and statement.
With no data on the domestic
agenda and markets closed for holiday
tomorrow, it is hard to expect anything
else than more of the recent sideways
trade in the EUR/PLN 3.85-3.90 range
throughout the rest of the week. The PLN
may react positively on Thursday if the ECB
disappoints those waiting for confirmation
that the tightening cycle will be extended into
early 2007, but even then the EUR/PLN
should not sustain a break past 3.85.
(CSOB - Investment research)