May 29, 2024 12:49 GMT
PLN: Risk-Off Backdrop Weighs on Zloty Following Soft Inflation Data
PLN
- A softer-than-expected preliminary inflation reading for May (+2.5% Y/Y vs. +2.8% exp.) resulted in only a brief uptick for EURPLN earlier today, with the move higher fully retracing within 15 minutes of the data release. Since then, the cross has taken cue from the broader risk-off tone across global markets, with zloty weakness on the session broadly in-line with that of its EMEA peers.
- Despite today’s 0.25% move higher, the cross remains contained within the relatively narrow band in which price has operated this month. 4.25 marks the key support level to watch – a level we are yet to close below. Initial resistance is found at 4.2732, the 20-day EMA.
- Following this morning’s inflation figures, NBP's Wnorowski called the data a "very good piece of information" but quickly added that the central bank's task is to ensure the sustainability of disinflation. The official pointed to wage pressures and inflation expectations as key sources of concern. There are no more data releases of note left on the local slate for the remainder of the week.
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