EUR/PLN likely to witness further downside over near-term, says Commerzbank

The EUR/PLN currency pair is expected to witness further downside risks over the near-term, driven by concerns about accelerating inflation and possible rate hikes next year, according to the latest report from Commerzbank.

The zloty strengthened against peers such as the forint following the publication of strong labor market data yesterday. While headline wage growth rate came in slightly softer-than-expected and indeed, underlying momentum of seasonally-adjusted month-on-month increases also slightly softened in September -- the data still showed a near 6.5 percent annualized wage growth rate currently.

"Given that job numbers are also robust, an argument can be made that domestic inflation cannot remain at current low levels for much longer. We, however, think that the story of inflation will turn out to be more multi-dimensional and complex than this," the report said.

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