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Why MNI
MNI is the leading provider
of intelligence and analysis on the Global Fixed Income, Foreign Exchange and Energy markets. We use an innovative combination of real-time analysis, deep fundamental research and journalism to provide unique and actionable insights for traders and investors. Our "All signal, no noise" approach drives an intelligence service that is succinct and timely, which is highly regarded by our time constrained client base.Our Head Office is in London with offices in Chicago, Washington and Beijing, as well as an on the ground presence in other major financial centres across the world.
POLAND
- Debates about how large the rate hike will be next week (Nov 3) has been rising following today's CPI print (inflation surged to a 20-year high).
- While consensus was still expecting the NBP to remain on hold yesterday, a 25bps hike now appears to be 'dovish'.
- It is likely that the NBP will proceed with another 40bps hike.
- Even though the NBP favors a cheap PLN, policymakers cannot run the risk of letting the domestic currency depreciate too much, as weaker PLN keeps supporting inflation expectations.
- A weak PLN could also start to weigh on risky assets in the medium term.
- The chart below shows that the momentum on Polish equities has remained firm despite PLN weakness, mostly driven by the global liquidity and risk-on environment.
- However, with the Fed preparing for tapering and the recent surge in Covid uncertainty, equities could start to consolidate if selling pressure on PLN remains elevated.
Source: Bloomberg/MNI
Why MNI
MNI is the leading provider
of intelligence and analysis on the Global Fixed Income, Foreign Exchange and Energy markets. We use an innovative combination of real-time analysis, deep fundamental research and journalism to provide unique and actionable insights for traders and investors. Our "All signal, no noise" approach drives an intelligence service that is succinct and timely, which is highly regarded by our time constrained client base.Our Head Office is in London with offices in Chicago, Washington and Beijing, as well as an on the ground presence in other major financial centres across the world.
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