The Polish Zloty (PLN) gained yesterday, a result of both the rise of the main currency pair and the comments by the head of the National Bank of Poland (NBP), Adam Glapiński. The EUR/PLN exchange rate was back within the boundary of key horizontal support, which stems from lows over the last few months (around 4.25). A 17 cent appreciation relative to the USD from the last 2 weeks has brought us to a current level below 4.03 for USD/PLN. Today, the focus will be on the NFP report as the market aims to convince itself that poor results from last month were caused by one-off special factors.
Revised NBP guidelines have created an appreciative stimulus for the zloty. Adam Glapiński presented a more “hawkish” position on monetary policy, highlighting that the debate on “cuts” to the monetary cost will likely begin in October 2025, indicating that we may expect reductions only at the beginning of the year 2026. This shift in position positively impacted the value of the PLN. Also of importance was yesterday’s significant risk appetite on European equity markets. Our stock market recorded above-average gains (WIG20 +1.88%).
This belief regarding the longer-term prospects of monetary policy dominates the entire Council and is not merely Glapiński’s personal view. The main reason for this shift appears to be the government’s plans, which concern regulated energy prices. Their control is expected to last until September 2025, after which they are set to increase. The question now arises whether the pattern of changes in administered prices should be the basis for shaping the NBP’s policy.
Glapiński underscored a cautious approach, pointing out the risk of a price spiral and emphasizing that the central bank cannot allow inflation expectations to deteriorate. Compared to its foreign counterparts, Poland’s institution is becoming markedly restrictive.
Looking at the data, one can see that the inflation index in Poland accelerated in November (0.4% m/m), indicating a situation that requires careful observation and most certainly setting off at least a yellow warning light in the NBP. Yesterday, there was a dynamic increase in FRA interest rate contracts (FRA 9×12 to 4.9550%), which shows that the market rejects the possibility of easing monetary conditions at the turn of the first and second quarters, something that seemed quite realistic not so long ago.
Author: Łukasz Zembik, Oanda TMS Brokers.
Source: https://managerplus.pl/zloty-zyskuje-dzieki-jastrzebiemu-stanowisku-nbp-i-optymizmowi-na-rynkach-32778
