Zloty Operates Near Neutral Levels

EUR/PLN sits at 4.3286, a touch higher on the day. A clearance of the 20-EMA at 4.3395 would expose the 50-EMA at 4.3875. Bears keep an eye on Dec 13, 2023 low of 4.2935 and Mar 4, 2020 low of 4.2870.

• NBP's Wnorowski said that the government's plan to widen the budget deficit may delay further rate cuts and underpin a "higher for longer" approach of the central bank. The official added that zloty strength helps reduce inflation but not significantly, while not being a threat to exports. Wnorowski warned that trying to put Governor Glapinski on trial would undermine the central bank's reputation and could push POLGB yields higher in the future.
• POLGB curve runs a tad steeper at typing, while the WIG20 Index has shed 0.3%.
• Poland's unemployment rate remained at 5.0% in November, in line with expectations.