Picture: USDPLN, EURUSD, GBPPLN, CHFPLN, NOKPLN, EURPLN performance and forecasts
After a wave of weakening of the zloty in early February and March, due to the beginning of the war between Russia and Ukraine, we noticed in the following weeks of March the return of the zloty to lower levels. Although the EUR/PLZ rate reached 5.0 (the highest level in history) in a panic, we are currently observing a consolidation of quotes between 4.60 and 4.70.
In the short term, we do not rule out pressure on the local currency and temporary weakness of the zloty again to 4.70 due to persistent geopolitical risks, rising inflation and slowing economic growth.
On the other hand, on a slightly longer horizon next year, we expect the EUR/PLZ to fall towards 4.60. Interest rate increases will strengthen the zloty – we expect the MPC to raise the reference rate to 8.00% in the coming months and keep it unchanged until the end of 2023.
See also: Exchange rates can make you stunned!
Arguments for the low price of EURPLN
- Expectations of further monetary tightening by NBP
- Better-than-expected macroeconomic data in Poland
- Positive solution to geopolitical risk factors in the country and in the world
See also: See for Franc, Yen, Ruble, Pound, Forint, Dollar, Koruna, Euro
Arguments in favor of increasing the price of EURPLN
- Smaller measure of interest rate increase compared to market expectations
- Inflation data in Poland is higher than expected
- The flight of capital from developing markets due to risk aversion caused, for example, by geopolitical factors in Europe and the world (eg the coronavirus, the economic situation in China, the conflict between Russia and Ukraine)
See also: Review the USDPLN analysis and check how much you can pay for major currencies in the near future
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