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Balance of Risks to the Upside For EUR/PLN Ahead of Today's NBP

POLAND
  • Local rates trade with a choppy bull flattening bias into today's NBP meeting.
  • Front end lifting slightly, with 5Y & 10Y yields holding their downtrend.
  • EUR/PLN has remained fairly subdued this week ahead of today's NBP.
  • Cross is rangebound between 4.5131-4.5366.
  • Although some are pricing in some sort of easing, the base case remains for a hold with QE, FX intervention/jawboning and dovish MPC comms being favoured over outright rate cuts.
  • Expecting to see more comments about an overvalued currency, and even perhaps a commitment to short term use of FX interventions should EUR/PLN drop below 4.50.
  • With downside capped in the short-term the balance of risks is to the upside in the cross.
  • Res1: 4.5366, Res2: 4.5576
MNI London Bureau | +44 020-3983-7894 | murray.nichol@marketnews.com
MNI London Bureau | +44 020-3983-7894 | murray.nichol@marketnews.com

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