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Disappointing Round Of Data Pressures Zloty

PLN

Zloty posts a leg lower on the back of Poland's macroeconomic data that were softer than forecast on balance. The Polish currency is the second-worst performer in the EMEA space at typing and now lags the greenback despite its overnight sell-off.

  • The annual expansion in Poland's industrial output slowed to +6.8% Y/Y (BBG est. +7.8%), while factory-gate inflation decelerated to +22.9% Y/Y (BBG est. +23.5%). Average wage growth was flat on a monthly basis and +13.0% annually versus the +13.9% Y/Y median forecast. Paid employment provided the only marginal surprise to the upside, rising 2.4% Y/Y last month.
  • mBank interprets the data as a confirmation that the economy is cooling, which will support the MPC's dovish wing. Pekao expect the decline in real wages to deepen and are forecasting industrial output to be in "solid minuses" early next year.
  • USD/PLN trades at PLN4.5870, a handful of pips above neutral levels. Initial resistance is at Nov 16 high of PLN4.6252, bears keep an eye on the 200-DMA/Nov 15 low at PLN4.5346/4.4760.
  • EUR/PLN last +96pips at PLN4.7067, pulling back from post-release session highs of PLN4.7177. Topside focus is on Nov 16 high of PLN4.7848, downside focus falls on Nov 11/8 lows of PLN4.6720/4.6690.

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