Zloty Trades Flat, Participants Weigh Data, Fiscal Matters & NBP Speak

EUR/PLN last trades at 4.3230, virtually unchanged on the day, with bears looking for an extension of losses from the past three days beyond the nearby 20-EMA (4.3168). On the topside, the focus falls on Jun 14 high of 4.3826.

• NBP's Ireneusz Dabrowski told MNI in an exclusive interview that a reduction in interest rates this year is the "least probable scenario," flagging his hawkish bias. In his view, rate hikes cannot be ruled out, while the most probable scenario is "wait and see." More details can be found in the full piece available on our website.
• Poland's industrial output missed expectations, while other data released in the first batch of economic activity indicators for May were roughly in line with forecasts. Annual wage growth remained in double-digit territory, arguably well above the NBP's comfort zone. The second batch of the data will be published tomorrow.
• The announcement that Poland may face the EU Excessive Deficit Procedure (EDP) has drawn attention to fiscal policy, with the government expected to consider measures to curb expenditure growth, while asking the European Commission for some leeway when it comes to defence spending.
• POLGB curve has bear steepened, with yields last seen 1.6bp-5.4bp above neutral levels. The WIG20 Index has added 0.5%.