Zloty Falters Amid Negative Risk Sentiment

EUR/PLN has edged higher as East European currencies struggle amid headwinds for the wider European FX space, even if the Zloty outperforms its CE3 peers. The rate last trades at PLN4.6929, up 100 pips on the session.

• From a technical point of view, bulls look for a move through Mar 20 high of PLN4.7215 before targeting Feb 22 high of PLN4.7654. On the flip side, bears need a retreat past Mar 1 low of PLN4.6620 to gain some impetus.
• POLGBs are firmer across the curve, albeit they have eased off best levels; yields last sit 5.3-9.2bp lower as we type. Local equity benchmark WIG20 index has shed ~2.3% this morning amid negative equity sentiment.
• Prime Minister Mateusz Morawiecki played down reports suggesting that the European Commission could withhold the disbursement of cohesion funds earmarked for Poland after already turning off the tap with post-COVID recovery funds over rule-of-law concerns.