The zloty has been depreciating significantly since this morning. The euro is attacking around PLN 4.80 again, the US dollar is the most expensive since 2001, and the Swiss franc is the most expensive in history. Other currencies in the region are also depreciating. All because of the increase in risk aversion caused by the aggression of Russia and Belarus on Ukraine.
Yesterday’s currency intervention by the National Bank of Poland (NBP) has not stopped the willingness to sell off the Polish currency. At 10:00 the EUR / PLN exchange rate was at the level of PLN 4.8010 and was rising by 6.1 grosz, after yesterday at noon the euro “shot up” to PLN 4.8084 and was the most expensive since 2009, so that after the intervention The NBP will drop below PLN 4.68 and finally end the day at PLN 4.7397.
The zloty is losing even more today in relation to the dollar and the Swiss franc. The USD / PLN quotations are rising by PLN 6.8 to PLN 4.33 and are testing levels not seen since 2001. The CHF / PLN exchange rate increases by 7.1 groszy to PLN 4.7110. Swiss currency has never been so expensive in history.
The zloty, like the Hungarian forint and the Czech koruna, have been depreciating significantly since Russia’s attack on Ukraine. This is the main factor that determines their behavior at the moment. The currency market is slowly beginning to rub against panic behavior, hence the volatility on it is huge and it is impossible to fully predict how it will behave. The good news is that when the geopolitical risk and the fear of aggression against Ukraine are extinguished, the zloty will recover most of the losses very quickly. The factor causing its latest discount will disappear. Hence, even in the perspective of 2-3 days, a return of EUR / PLN significantly below PLN 4.60 is then possible.
Yesterday’s intervention of the NBP, as shown today, did not stop the zloty depreciation for a long time, but it is a strong signal that the central bank is concerned about the current exchange rate of the Polish currency. Therefore, further interventions should be expected to strengthen it. It should also be assumed that the NBP is getting closer to using a much more practical tool in the fight against the weak zloty. Namely, from the exchange of European funds on the market instead of at the central bank.
Source: ISBnews
