The dollar rises to a six-week high, the euro below 4.25 zł

The złoty remains firm despite tensions in the Middle East

Concerns over the possibility of a renewed war with Iran supported the dollar and pushed oil prices higher. Even so, the złoty is holding steady for now. The euro rate remains close to Friday evening’s level, while USD/PLN edged higher.

On Monday morning, the euro rate stood at 4,2468 zł. Since the start of March, that is since the Israeli-American attack on Iran, the EUR/PLN pair has been moving in a wide range of 4,2250-4,3070 zł. This means the market is still waiting for a stronger impulse.

The situation in the commodities market is more tense. Over the weekend, military activity in the Middle East escalated, and Brent crude broke above 110 USD per barrel. The Strait of Hormuz remains largely blocked, deepening the fuel crisis and making trade in many industrial commodities more difficult.

In this environment, the dollar also gained against the euro. EUR/USD fell below 1,17, and the U.S. currency in Poland climbed above 3,65 zł, reaching its highest level since 8 April. PKO BP analysts note that a sustained break above 3,66 zł could open the way toward around 3,70 zł.

In the morning, CHF/PLN was quoted at 3,6468 zł, while the British pound cost 4,8754 zł. In both cases the moves were small, but they show that geopolitical tensions are still keeping the currency market on alert.

Sources

1. Current exchange rates: National Bank of Poland (average exchange rates table)