Zloty Holds Tight Range, Earlier Bear Flattening In POLGB Curve Moderates

EUR/PLN topped out just shy of the 4.8 figure and pulled back from there, with fresh NBP speak getting some broader airing, following the release of local inflation data which failed to meet dovish expectations. The rate last deals at 4.4739, up 62 pips on the session, oscillating within a familiar range.

• It is worth noting that the formal implication of bringing the next NBP monetary policy meeting forward is the shift in the media blackout period. The decision to call the meeting for September 5-6 implies that MPC members should not speak to reporters. The blackout period starts five days before an MPC meeting and ends one working day after, but the NBP's policy is that the Governor is effectively exempted.
• Still, comments from MPC's Henryk Wnorowski crossed the wires and the official suggested that the first rate cut will be delivered in either September or October, but it's too early to say when exactly. He expects disinflation to accelerate from September as the holiday season draws to an end.
• POLGB curve remains bear flattened on the day, despite unwinding some of the initial move caused by the release of a double-digit inflation print. FRAs have largely retraced their earlier upticks (albeit the 3x6 contract remains higher on the day), with most sell-side desks sticking with their earlier NBP calls as consensus looks for a 25bp cut next week.