Zloty Reverses Gains But Still Outperforms CE3 Peers

EUR/PLN has stabilised after moving away from earlier session lows and last operates at PLN4.4455, up 45 pips on the day. Familiar technical contours remain intact. Although the zloty underperforms the EUR at typing, it fares better than its regional peers CZK and HUF.

• Citibank wrote in their weekly note that the earliest possible timing of the NBP's rate cut is November, when the Monetary Policy Council will have inflation data for September and and updated macroeconomic projection. Citi economists think that actual rate cuts may come even later due to fiscal loosening and electoral uncertainty. They expect Poland's fiscal deficit to reach 5.6% of GDP this year.
• POLGBs have recouped much of their initial losses, with yields last seen 0.4-1.9bp higher. The WIG20 Index has added ~0.7% thus far, printing new cyclical highs.