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Zloty Intervention Now Would Not Make Sense (Former Governor Belka)

POLAND
  • Selling pressure on PLN has been elevated in recent weeks amid rising political and economic uncertainty in Poland.
  • In addition to the Covid uncertainty (which may lead to significant downward revision in growth expectations), there are a number of risks in Poland that can impact the zloty in the medium term:
    • on-going dispute with the EU,
    • fines and delay in pandemic aid,
    • FX-loan settlements,
    • rising LT bond yields.
  • Yesterday, Mateusz Morawiecki mentioned in a press conference this morning that Poland will do 'everything in its communication and actions' to make the zloty 'slightly' stronger.
  • This morning, former central bank Governor Marek Belka told in an interview that a zloty intervention now would not make sense.
  • Economic data to watch this morning are construction output and retail sales.

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