Central banks impair PLN

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Central banks impair PLN

The US Federal Reserve decided to raise interest rates for the second time this year. As if that was not enough, the Fed also published a plan to reduce its balance sheet, and the sent message and economic forecasts suggest that it is not the end of tightening monetary policy in the coming months.

The American central bank, on the one hand, tries to keep up with the plan it has already developed and, on the other, economic data suggest that it does not have to be a sensible solution. Inflation has clearly slowed down, retail sales are falling, and there are fewer chances of a rebound in the second quarter.

Also, the Bank of England made a decision on interest rates yesterday. Monetary policy has remained unchanged, but the distribution of votes for a raise (5-3 against) shows that interest rates in the UK may change in the coming months.

The worse times of the Polish currency stem from the outflow of capital from emerging markets, which results from the appreciation of the dollar. Lower inflation also didn’t help, although those investing on the Polish market are less interested in macro data. The continuation of the correction on the USD market should be associated with a momentary weakening of the PLN, which is why the nearest days may be slightly worse for PLN performance.

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