KBC Market Research Desk
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Zloty nervous ahead of the elections
Czech PPI deflation remains in place
The Polish zloty and the Hungarian forint have both came under pressure, partly due to weakening euro and widening yield spreads across the euro area. Also the nervousness ahead of the Polish presidential elections can play a role and raise volatility in these days. Although the most recent polls fancy current president Komorowski in the second round of the election, the gap is narrow. And we should keep in mind how severely did polls preceding the first round of the presidential elections underestimate popularity of the opposition candidate, Mr. Duda.
Today, fresh Polish data should confirm solid performance of the Polish labour market. Rising employment along with nominal wage growth exceeding 4 % should play in favour of the zloty. Still, traders may remain cautious ahead of Sunday election.
In the Czech Republic, producer prices´ fall continued in April (-2.6% y/y). Industry benefits namely from low energy prices, but deflation pressures have been broadbased and actually only a few items in the producers´ basket, such as water, are rising in price.
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.
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