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Zloty Consolidates Losses, Poland's Current Account Surplus Narrows

PLN

EUR/PLN has been struggling to re-test its earlier session highs at PLN4.4893 and last operates +269 pips at PLN4.4733, with familiar technical levels still in play. POLGBs have trimmed their earlier gains, with curve running marginally steeper as we type.

  • The government unveiled the 2024 budget assumptions, with GDP growth seen at +3.0% Y/Y and CPI inflation expected to settle at +6.6% Y/Y. Finance Minister Magdalena Rzeczkowska said that the government expects "slight" monetary policy easing next year.
  • While discussing the assumptions for the 2024 spending plan, Prime Minister Mateusz Morawiecki announced that the monthly minimum wage will be hiked to PLN4,242 from January and to PLN4,300 from July next year.
  • Poland's current account surplus shrank to EUR359mn in April from EUR1.643bn prior, missing the EUR1.595bn consensus forecast. Trade surplus narrowed to EUR209mn from EUR608mn versus EUR1.385bn expected.
  • UBS circulated a note suggesting that EUR/PLN losses appear overdone, with bullish risks piling, including expectations of a dovish pivot from the NBP, ongoing issues around FX mortgages and Poland's lack of access to EU funds.

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