EUR/PLN Probes Water Below 4.30 Ahead Of NBP Rate Decision

EUR/PLN has slipped past the 4.30 figure and last deals at 4.2985, around 40 pips lower on the day. From a technical perspective, the area around Apr 9 low of 4.2527 and the round figure of 4.25 provides a key near-term bearish target. Bulls continue to set their sights on 4.3728, which capped gains on Apr 16.

• The highlight of the local calendar today is the announcement of the NBP's monetary policy decision, which is expected to confirm universal expectations of continued stabilisation of interest rates. Recent data from the real economy have fallen on the weaker side, but inflation is expected to accelerate in 2H2024, with the NBP likely to hold off on any rate adjustments at least until there is more clarity on that front. Governor Adam Glapinski will hold his press conference on Friday.
• The Ministry of Family and Social Policy said that the unemployment rate slipped to 5.1% in April, according to the preliminary estimate. Statistics Poland will release the full report on May 27.
• ING wrote that EUR/PLN should return below 4.30 by the end of the week, which could pave the way for a move towards YtD lows of 4.26 later this month. They expect the pair to fall to 4.20 in Q2/Q3, with a risk of a rebound to 4.30 in 2H24.
• The WIG20 Index refreshed cyclical highs this morning and last sits 0.7% above its previous close.