The dollar was making up for losses. The zloty remained strong

The significant recovery in the euro-dollar pair was not accompanied by significant changes in the euro exchange rate. The Polish zloty remained strong in a turbulent foreign environment. The Swiss franc once again attacked the upper limit of the current sideways trend.

Recent days have brought a sudden increase in volatility on financial markets. The EUR/USD rate, which last Tuesday reached its highest level since June 2021, plummeted downwards, falling from nearly USD 1.21 to USD 1.1850 over the previous three sessions.

This move caused the dollar exchange rate on the Polish market to rebound from an 8-year low, rising from less than PLN 3.49 to over PLN 3.56. On Monday at 9:50 a.m. the dollar was quoted at PLN 3.5499. That is still 6.5 cents above the January minimum.

All this happened with quite moderate volatility on the euro-zloty pair. On Monday morning, the euro exchange rate was PLN 4.2100, although earlier in the morning the community currency was valued at nearly PLN 4.22. It was also not possible to break the psychological support at the round level of PLN 4.20.

– Assuming that the deterioration of market sentiment at the end of the week will not escalate, we believe that the EUR/PLN exchange rate will remain in the local horizontal trend of 4.20-4.22. In our opinion, after the correction from the second part of the week, the dollar may come under pressure again in the coming days, which would probably result in a test of the level of 1.21 on EUR/USD, which would push the USDPLN rate below 3.50 – this is how PKO BP strategists assessed the situation.

An even bolder forecast was presented by Sobiesław Kozłowski from Noble Securities. According to Kozłowski, the USD/PLN exchange rate, after breaking the long-term upward trend, is now heading towards PLN 3.30 – i.e. the minimum from January 2018. The analyst noted that the previous long-term downward trend in the dollar-zloty pair was in force in 2000-08 and lasted 8 years. Now the dollar has been weakening for almost 3.5 years.

It is worth noting the strength of the Swiss franc, which on Thursday was the strongest in history in relation to the euro. On the Polish market, this resulted in the CHF/PLN exchange rate again attacking the PLN 4.60 line – i.e. the upper limit of the sideways trend that has been in force since April last year. On Monday morning, the franc was valued at PLN 4.5977.

There has been much less emotion on the British pound market lately. Sterling cost PLN 4.8621 in the morning, i.e. 0.7 groszy less than before the weekend. After the November rebound from 6-year lows, the GBP/PLN exchange rate is in the range of PLN 4.80-4.90.

K.K

Source: