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The dollar is the most expensive in 6 weeks. USD/PLN rises amid tensions and yields
The dollar is pricier again, and the złoty remains under pressure
The foreign exchange market is showing more caution from investors today. USD/PLN rose to 3,6686 zł in the morning and was at its highest level in 6 weeks. At the same time, EUR/PLN held near 4,2548 zł, slightly above Tuesday’s level.
This reflects a weaker appetite for risk. Investors are reacting to falling government bond prices and a lack of progress in peace talks with Iran. In this environment, some capital is moving out of riskier assets, including emerging markets.
The U.S. dollar, which serves as a safe haven, is benefiting the most. In addition, the yield on 30-year U.S. government bonds rose to its highest level since 2007. That is fueling concerns about inflation and a faster decline in the value of money.
On the euro-dollar market, EUR/USD fell below 1,16 USD to its lowest level since April 8. For the złoty, this means a worse backdrop, as a weaker euro and a stronger dollar usually limit room for the Polish currency to strengthen.
Against the euro, however, the situation remains relatively calm for the złoty. Since the beginning of March, the rate has been moving in a broad sideways range, and for more than a month it has mostly stayed between 4,2250 zł and 4,2650 zł. The Swiss franc cost 4,6407 zł in the morning, while the British pound was at 4,9148 zł.
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