Zloty Gains In Defiance Of Weak Retail Sales Data

EUR/PLN is losing altitude despite another round of soft Polish macroeconomic data this morning. The pair last deals at PLN4.6945, nearly 95 pips worse off, hitting new session lows. Bears look for a sell-off towards trendline support drawn off Jun 8 low, which kicks in at PLN4.6800. Bulls take aim at Nov 16 high of PLN4.7848.

• The annual expansion in Poland's retail sales was 18.3% in October versus consensus forecast of 21.0% as elevated inflation is limiting the purchasing power of consumers. Real retail sales were up just 0.7% Y/Y (vs. median est. of +3.2%) with Pekao economists expecting negative readings in the coming months.
• Weak data may have facilitated a pullback in Polish gov't bond yields, which have trimmed earlier gains to +6.7bp-1.7bp across the flattened curve. Benchmark 10-year yield hovers near its two-month lows.
• WIG 20 gains for the second consecutive day, confirming a bull flag pattern, with the 200-DMA providing the next topside target at 1,756. Elsewhere in V4, Czechia's PX is slightly weaker, while Hungary's BUX refreshes cyclical highs.
• Earlier this morning, oko.press published an interview with NBP hawk Kotecki, who estimated that domestic factors are responsible for "40%-50%" of the current inflation, blaming the central bank for acting too late and accusing the government of excessively expansionary fiscal policy.