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PLN: Zloty Tad Softer Despite Strong GDP Data

PLN

EUR/PLN has crept higher, snapping a two-day losing streak amounting to a 0.7% loss versus last Friday's close. The zloty has shown muted reaction to NBP talk and stronger-than-expected GDP data released out of Poland. When this is being typed, the pair deals +30 pips at 4.2940 and a return above 4.30 would put bulls in a position to challenge Aug 9 high of 4.3309. Conversely, Jul 26 low of 4.2671 remains the key near-term bearish target.

  • Poland's GDP rose by 3.2% Y/Y in Q2, according to preliminary data from the statistics bureau. Growth was significantly stronger than expected (+2.7%) as consumption provided a boost, helping offset underwhelming investments and external demand. This came after PM Tusk suggested that NBP Governor Glapinski's "restrictive, hawkish policy" prevents Poland from achieving its desired growth outcomes.
  • Separately, final CPI data confirmed that inflation accelerated to +4.2% Y/Y in July from +2.6% prior. Local sell-side desks noted that almost the entirety of the increase was down to the energy price hikes following the government's decision to partially withdraw relevant price shields.
  • POLGB yields are marginally above neutral levels. The WIG20 Index sits 0.5% above neutral levels.

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