EUR/PLN to reverse back towards the 4.770 area – ING
|The Polish zloty is testing stronger levels. Nevertheless, economists at ING expect the EUR/PLN pair to revert back to the 4.770 mark.
Interest rate differential unlikely to be supportive of the zloty
“Zloty was supported yesterday by a rise in market expectations for a rate hike and could thus benefit from a rising interest rate differential for the first time in a while. However, this is not enough and if bets on rate hikes do not increase further, the zloty will revert back to 4.770 EUR/PLN.”
“Markets are already expecting more than a 50 bps rate hike at the September National Bank of Poland meeting at this point, which we already think is a very aggressive expectation. Therefore, we do not expect the interest rate differential to be supportive of the zloty.”
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