Zloty Falters In Early Trade, January CPI Headlines Local Docket This Week

EUR/PLN has added 158 pips and last changes hands at PLN4.7874 so far, printing new cyclical highs at PLN4.7920 earlier in the session. The rate is approaching the 61.8% retracement of the Sep 30 - Dec 26 sell-off at PLN4.7945, with the 76.4% Fibo level coming up next at PLN4.8340. On the flip side, bears keep an eye on Feb 2 low of PLN4.6787.

• POLGB yields have advanced across the curve, with 5s underperforming as we type, while 10-year POLGB/Bund yield differential has widened to levels last seen three weeks ago. Benchmark WIG20 stock index has shed ~0.4% and is testing support from its 50-DMA, even as its CE3 peers BUX & PX have lodged some gains.
• NBP's Joanna Tyrowicz, the most hawkish MPC member, pushed back against Governor Adam Glapinski's personal view that inflation might slow to +6% Y/Y at the year-end. She noted that the central bank's official projections imply a different inflation path, adding that consumer prices could grow +10% Y/Y at the end of 2023. Tyrowicz argued that inflation might not return to the target until at least 2025.
• Poland's current account balance for December will hit the wires this afternoon. Looking further afield, the focus will shift to GDP and CPI data in the coming days. The inflation outturn will be closely watched, especially that the sell-side forecast range is fairly wide (+16.5% to +18.9% in a Bloomberg poll).