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The pound hits new highs, while the złoty remains stable against the euro and the dollar
The zloty is calm at the start of the week. The pound is at its strongest in months
Monday morning brings stability for the zloty against most major currencies. After stronger moves last week, the market is now waiting for inflation data from the U.S. and Poland, as well as news from the geopolitical front. These are the factors that could decide in the coming days whether the zloty holds its current levels.
At around 10:00 AM, the euro exchange rate stood at 4,3886 zł. For someone exchanging 1000 zł, that means buying about 227,9 euros. This is a level very close to Friday’s reference point, so this morning’s exchange rate gives neither the client nor the exchange bureau a clear advantage today. In the background are also remarks from the NBP governor, which the market read as fairly hawkish, meaning they leave room for an interest-rate hike if conditions are favorable.
The dollar exchange rate is also slightly higher than on Friday. USD/PLN was trading at 3,9167 zł in the morning, almost the same as at the end of the previous session. Exchanging 5000 zł gives about 1276,6 dollars. The dollar gained nearly 0,6 proc. last week, and two weeks earlier it rose by 1,5 proc., so the U.S. currency remains strong against the zloty.
The market is now watching above all Wednesday’s CPI, or consumer inflation, reading from the U.S. These are data that could reshape expectations for the Fed and the path of interest rates in the United States. Before that, on Tuesday, investors will learn the IMF forecasts, and central bankers will speak at the annual IMF and World Bank summit.
By far the strongest currency today is the British pound. GBP/PLN remains near record highs, and after testing 5,1937 zł, the rate stood at 5,1893 zł after 10:00 AM. That means 1000 zł buys about 192,7 pounds. That is much more than in previous months, so for people sending transfers to the UK or buying the local currency there, this is a costly level.
The pound is being supported by better prospects for the British economy and expectations of moves by the BoE. The pressure is not eased by the strong dollar either, which has performed well against the pound in recent weeks. Meanwhile, CHF/PLN looks stable, trading at 4,7090 zł in the morning. The franc, however, remains close to multi-month highs, so for people repaying obligations in this currency it is still relatively expensive.
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