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
EUR/USD clings to gains above 1.0750 after US data
EUR/USD manages to hold in positive territory above 1.0750 despite retreating from the fresh multi-week high it set above 1.0800 earlier in the day. The US Dollar struggles to find demand following the weaker-than-expected NFP data.
GBP/USD declines below 1.2550 following NFP-inspired upsurge
GBP/USD struggles to preserve its bullish momentum and trades below 1.2550 in the American session. Earlier in the day, the disappointing April jobs report from the US triggered a USD selloff and allowed the pair to reach multi-week highs above 1.2600.
Gold struggles to hold above $2,300 despite falling US yields
Gold stays on the back foot below $2,300 in the American session on Friday. The benchmark 10-year US Treasury bond yield stays in negative territory below 4.6% after weak US data but the improving risk mood doesn't allow XAU/USD to gain traction.
Bitcoin Weekly Forecast: Should you buy BTC here? Premium
Bitcoin (BTC) price shows signs of a potential reversal but lacks confirmation, which has divided the investor community into two – those who are buying the dips and those who are expecting a further correction.
Week ahead – BoE and RBA decisions headline a calm week
Bank of England meets on Thursday, unlikely to signal rate cuts. Reserve Bank of Australia could maintain a higher-for-longer stance. Elsewhere, Bank of Japan releases summary of opinions.