The euro is the most expensive it has been in nearly three years. EUR/PLN rises to 4.39 zł

Euro and dollar are more expensive, the złoty is under pressure

The morning setup on the currency market is not helping the złoty. The euro rate moved closer to 4,40 zł, and the U.S. dollar was trading at its strongest level since April 2023. For someone exchanging money, that means that at these levels 1000 zł buys less foreign currency than it did just a few months ago.

By 10:00 AM, EUR/PLN was up by 1,6 grosz and reached 4,3943 zł. That is the highest euro level since November 2023, so the common currency is clearly more expensive today than at the beginning of June, when the pair was more than 16 grosz lower. When exchanging several thousand złotys, the difference is already noticeable in the wallet.

The złoty is weakening mainly because of a stronger dollar and poorer investor sentiment across the Atlantic. Also in the background were higher oil prices after no progress in talks between the U.S. and Iran, as well as better-than-expected PMI (Purchasing Managers’ Index) readings from the euro area and the U.S. This has raised expectations about the size of rate hikes by the major central banks.

In this environment, government bond yields rose in core markets, and the yield on 10-year UST reached 5,11%. Higher rates and more expensive financing usually support the dollar, which is why EUR/USD fell below 1,14 USD for the first time since July. For people settling in euros or dollars, that means less favorable currency conversion conditions.

In the morning, the U.S. dollar was trading on the interbank market at 3,8534 zł. Earlier, USD/PLN moved above 3,86 zł, which made it the highest since April 2023. Meanwhile, the Swiss franc cost 4,6591 zł, and the British pound rose to 5,1168 zł and matched its July peak.

Sources

1. Current exchange rates: Narodowy Bank Polski (average exchange rate table)