Preliminary GDP data show that the Polish economy is growing at its fastest pace in more than three years. At the same time, the U.S. dollar continues its gradual decline against the euro. Against this backdrop, the cryptocurrency market is experiencing a sharp sell-off.
Who Wasn’t Surprised by the GDP Reading?
Poland’s GDP grew by 3.7%, which is higher than the NBP model forecast of 3.4%, but in line with market expectations. Faster economic growth is certainly good news, but it also reshapes the current narrative. The story of a slowing economy weighed down by high interest rates is becoming harder to defend. As a result, stronger economic data push interest rate cuts further into the future.
This matters far more for household budgets than the GDP figure itself. Higher rates mean higher returns on deposits for savers, but most importantly, borrowers with variable-rate loans may have to wait longer for their monthly payments to decrease. On the foreign exchange market, the GDP numbers strengthened the złoty. For yet another day in a row, the EUR/PLN exchange rate has stabilized around 4.23 zł.
Another Day of Dollar Weakness
On Wednesday, the EUR/USD rate returned to 1.1650, a level last seen more than two weeks ago. During that time, the dollar had been nearly two cents stronger. Many analysts connect the current weakness of the U.S. currency to the ongoing process of reopening the government. The record-long government shutdown will certainly affect the economy, and such a prolonged halt is expected to weigh on fourth-quarter GDP.
On the other hand, the sudden inflow of funds following the reopening could also have a pro-inflationary effect. Interestingly, markets appear increasingly aligned in their expectations for monetary policy. Day by day, the odds of a December rate cut are dropping. At this point, the probability of a cut or no cut at all is almost the equivalent of a coin toss.
Is This the Beginning of the End of the Crypto Rally?
Yesterday, Bitcoin broke below the key level of $100,000 per BTC. Other cryptocurrencies—aside from stablecoins, whose value is fixed—fell proportionally or even more sharply. At the time of writing, Bitcoin is trading at $97,000, its lowest level since early May.
What is driving these steep declines? Above all, the market has seen an unusually large number of long-term Bitcoin holders selling in recent days. Another key factor is the significant spike in closed derivative positions tied to rising crypto prices. These liquidations also exert downward pressure on the market.
Despite a nearly $30,000 drop from the October highs, investors who have held Bitcoin since the beginning of the year remain in profit—though the margin is getting uncomfortably thin.
Disclaimer
The information contained in this publication is for informational purposes only. It does not constitute financial advice or any other form of advice, is general in nature, and is not addressed to any specific recipient. Before using the information for any purpose, you should seek independent professional advice.
Source: CEO.com.pl – Mocne dane z polskiej gospodarki, słaby dolar i wyprzedaż na rynku kryptowalut (https://ceo.com.pl/mocne-dane-z-polskiej-gospodarki-slaby-dolar-i-wyprzedaz-na-rynku-kryptowalut-56520)
