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NBP Expected To Stay On Hold This week; EUR In The Driver's Seat

POLAND
  • local yields open lower in slight bull flattening this morning.
  • 10Y yields rejected the push higher beyond 1.24, and should look to target 1.20 on sustained optimism.
  • USD/PLN opens -0.36% lower this morning, bolstered by EUR/USD upside as the cross pushes towards the 1.20 handle with bearish bets on the dollar adding fuel to the move higher.
  • Focus this week will remain on the NBP meeting which is largely expected to be a placeholder meeting with consensus for a hold being priced in across the board.
  • Focus for the meeting will be on QE and warnings regarding PLN strength and its ability to curtail the recovery (MNI preview due tomorrow).
  • USD/PLN move below 3.74 opens up a push lower towards 3.70, but analysts have warned delays to the EU budget & recovery fund may begin to weigh more on PLN strength this week.
  • Monitoring EU side comms on ways to sideline Poland & Hungary's veto capacity will be key.
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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