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PLN: Zloty Remains Afloat But POLGB Yields Pull Back After Weak Retail Sales

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Dismal retail sales data released out of Poland have sapped some of the zloty's earlier strength, even as the currency remains afloat and continues to outperform most of its EMEA peers. When this is being typed, EUR/PLN deals at 4.3138, down 71 pips on the session. The low print of Oct 14 provides the initial layer of support at 4.2867, while bulls look for a rebound above Aug 9 high of 4.3309.

  • POLGB yields last sit -1.0bp to +5.3bp versus neutral levels, with the curve running steeper on the day. They pulled back from initial highs in reaction to disappointing data amid speculation that it might filter through into the NBP's deliberations. In their commentary after the release of retail sales figures, mBank wrote that the data is another serious argument in favour of interest-rate cuts, alongside weaker-than-expected wage growth. Immediate comments from local desks can be found in our earlier bullets.
  • This comes after Bloomberg circulated comments from IMF's Geoff Gottlieb, who said that "if the [Polish] government introduced more tightening adjustments earlier, which is by the end of 2025, it would allow monetary policy to loosen faster." This would "also reduce interest rates on public debt and help reduce public debt faster."
  • The Finance Ministry will offer PLN7bn-11bn (versus PLN6bn-12bn in the initial monthly issuance schedule) of OK0127, PS0130, WZ0330, DS0432, DS1034, IZ0836 and WS0437 bonds at an auction tomorrow.
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Dismal retail sales data released out of Poland have sapped some of the zloty's earlier strength, even as the currency remains afloat and continues to outperform most of its EMEA peers. When this is being typed, EUR/PLN deals at 4.3138, down 71 pips on the session. The low print of Oct 14 provides the initial layer of support at 4.2867, while bulls look for a rebound above Aug 9 high of 4.3309.

  • POLGB yields last sit -1.0bp to +5.3bp versus neutral levels, with the curve running steeper on the day. They pulled back from initial highs in reaction to disappointing data amid speculation that it might filter through into the NBP's deliberations. In their commentary after the release of retail sales figures, mBank wrote that the data is another serious argument in favour of interest-rate cuts, alongside weaker-than-expected wage growth. Immediate comments from local desks can be found in our earlier bullets.
  • This comes after Bloomberg circulated comments from IMF's Geoff Gottlieb, who said that "if the [Polish] government introduced more tightening adjustments earlier, which is by the end of 2025, it would allow monetary policy to loosen faster." This would "also reduce interest rates on public debt and help reduce public debt faster."
  • The Finance Ministry will offer PLN7bn-11bn (versus PLN6bn-12bn in the initial monthly issuance schedule) of OK0127, PS0130, WZ0330, DS0432, DS1034, IZ0836 and WS0437 bonds at an auction tomorrow.