CPI Softer Than Forecast, But Minimal Impact on Currency

Poland CPI (Jul P) M/M -0.2% vs. Exp. 0.0% (Prev. 0.0%), Y/Y 10.8% vs. Exp. 11.0% (Prev. 11.5%)

• Food and non-alcoholic drinks were the driver of the M/M inflation miss: falling 1.2% on the month from -0.3% in June. This countered flat energy prices and a 0.4% rise in fuel on the month.
• All categories slowed on a Y/Y basis, with Food slowing to 15.6% from 17.8% and electricity/gas slowing to 16.7% from 18.0%. Pace of fuel price decline slowed to -15.5% from -18.0% last month.
• Uptick in EUR/PLN on release puts prices at 4.4143 before fading to pre-announced levels swiftly. The cross has hit new pullback and YTD lows already today, touching 4.4039 to extend the late July move lower.
• H2 2020 lows at 4.3755 are next up on any further weakness in the cross.