Strong growth set to support the zloty

It is believed that the December weakness of the PLN can mainly be ascribed to a strong EUR and general risk-off emerging market sentiment. Against the USD, the PLN has remained quite stable and one of the best performing emerging markets currencies. This supports the view that the Polish economy is fundamentally strong. 

Over the past days, the PLN has rebounded against the EUR as the EUR has weakened and the Polish government has affirmed its commitment to sound fiscal management. On a 3- 12M horizon, the PLN is expected to remain supported by a more positive growth outlook and relative monetary policy divergence. 

"We expect EUR/PLN to fall back towards 4.00 in 12M", says Danske Bank.