KBC Market Research Desk
KBC Bank
The regional currencies strengthened against the euro on Friday. The Czech koruna, supported by better than expected results of industrial production in February, strengthened by about 0.2 % and the forint, outperforming its peers, even settled at the highest level since more than a year. Only in Poland the national currency hardly changed last Friday; however, in the last week as a whole, owing to the combined effect of ECB’s QE and highly positive real interest rates, the zloty appreciated by more than one percent.
As for the week ahead, Polish central bank´s meeting on Wednesday will be the eye-catcher. As markets generally expect rate stability, most attention will be paid to the subsequent press conference. Let us recall that since the rate cut by 50 bps early in March, the NBP has declared itself strongly committed not to go with interest rates further down in the following months. The commitment belongs, in our view, among key factors responsible for recent appreciation of the zloty. It will be interesting to hear if and how the NBP comments on the zloty, whose appreciation not only further suppresses inflation (CPI for March will be released next Wednesday, too) but it could also lower inflation expectations. From this perspective, it will not be much surprising, if some form of verbal intervention against the strong zloty happens on Wednesday.
This non-exhaustive information is based on short-term forecasts for expected developments on the financial markets. KBC Bank cannot guarantee that these forecasts will materialize and cannot be held liable in any way for direct or consequential loss arising from any use of this document or its content. The document is not intended as personalized investment advice and does not constitute a recommendation to buy, sell or hold investments described herein. Although information has been obtained from and is based upon sources KBC believes to be reliable, KBC does not guarantee the accuracy of this information, which may be incomplete or condensed. All opinions and estimates constitute a KBC judgment as of the data of the report and are subject to change without notice.
Recommended Content
Editors’ Picks
AUD/USD remained bid above 0.6500
AUD/USD extended further its bullish performance, advancing for the fourth session in a row on Thursday, although a sustainable breakout of the key 200-day SMA at 0.6526 still remain elusive.
EUR/USD faces a minor resistance near at 1.0750
EUR/USD quickly left behind Wednesday’s small downtick and resumed its uptrend north of 1.0700 the figure, always on the back of the persistent sell-off in the US Dollar ahead of key PCE data on Friday.
Gold holds around $2,330 after dismal US data
Gold fell below $2,320 in the early American session as US yields shot higher after the data showed a significant increase in the US GDP price deflator in Q1. With safe-haven flows dominating the markets, however, XAU/USD reversed its direction and rose above $2,340.
Bitcoin price continues to get rejected from $65K resistance as SEC delays decision on spot BTC ETF options
Bitcoin (BTC) price has markets in disarray, provoking a broader market crash as it slumped to the $62,000 range on Thursday. Meanwhile, reverberations from spot BTC exchange-traded funds (ETFs) continue to influence the market.
US economy: slower growth with stronger inflation
The dollar strengthened, and stocks fell after statistical data from the US. The focus was on the preliminary estimate of GDP for the first quarter. Annualised quarterly growth came in at just 1.6%, down from the 2.5% and 3.4% previously forecast.