Local-Currency Bond Yields In Retreat

EUR/PLN trades +19 pips at PLN4.7018 as we type, with the pair struggling for a clear direction through the session. A familiar technical picture remains in play.

• POLGB yields have been in retreat, which has been facilitated by broader strength in core FI markets. Benchmark 10-year yield printed new five-month lows at 5.77% as a result. Poland/Germany 10-year yield spread has tightened to around 381bp.
• Worth noting that Poland's development bank BGK sold just PLN220mn in FPC0328 and FPC1140 series of COVID relief funding bonds in today's auction, despite attracting demand for a total of PLN5bn. It then sold an additional PLN50mn of FPC038 in a top-up auction.
• Much of the rhetoric from Poland's political leaders present in Davos revolved around the need to ramp up support for Ukraine. Prime Minister Morawiecki said that Warsaw is pushing for tighter sanctions against Russia and seeks to build a coalition of nations that could provide some 100 heavy battle tanks to Ukraine.
• Looking ahead, Poland's consumer confidence will hit the wires tomorrow morning.