More modest zloty profit taking took the
EUR/PLN pair further north and into the 3.82
area on Thursday, where the losses were
capped as the zloty settled into an extremely
tight trading rage in the absence of US
players. The domestic agenda would have
been completely empty if not for the core
inflation report, which as expected was no
market mover for the zloty.
EUR/PLN 3.82 has provided the
zloty with strong short-term support, and it
will remain a crucial milestone for the zloty
too. We feel we have not yet seen the end
of this weeks’ corrective action and the
zloty could end the session lower today
especially if bonds suffer losses on the back
of the strong retail sales data (more in FI
part). Nonetheless these numbers should
also underpin the growth perspectives of the
Polish economy at the beginning of 4Q,
which as such may help offset the downward
pressure on the zloty. A break of the
EUR/PLN 3.82 level would put the focus
towards the 3.84 level.
(CSOB - Investment research)