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30.01.2009 - Weekly Currency Brief

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Date: 2009-01-30 19:37

The most significant data during the week was Fridays Advance GDP from the US economy.  Fridays readings was better than analysts anticipated, signaling that at least in the short term there may be a reaction on global stock markets. As the EURUSD market has been recently positively correlated with stock markets, an increase can be expected to the resistance level of 1.3325, giving the market a chance to rebound after the strong plummet since mid December.


The USDPLN and EURPLN markets both noted  an increase, which is connected with the decrease of interest rates by 75 basis points to the level of 4.25% by the Monetary Policy Council (RPP) on Wednesday, and also with the risk aversion that is concerned with the whole region.  This decrease trend was strengthened by Polish Prime Ministers words with regard to the GDP in 2009, which highlighted that the level of 1.7% is possible.  On the other hand when comparing the Polish economy to similar ones, the situation does not seem to be so bleak.

What has to be added is that owing to the weak Zloty, local exporters have become more and more active mending some of the losses caused by lower level orders from Poland’s biggest trade partner – Germany.  The trade balance is currently one of the more significant factors that could help the Polish economy flourish in the following quarters.


Pawel Nieradka