German Unexpected Growth Improves Zloty Rally

The Polish currency benefited from yesterday’s report indicating an unexpected growth of 0.3 for the German economy in the second quarter, which improved investors’ confidence towards the future of European economic conditions.

Among emergent-market currencies, the zloty is being one of the best performing currencies, and yesterday, Germany’s quarterly GDP report pushed the Polish currency even further to higher levels, as improving economic numbers in the region led traders to speculate that the Polish central bank is likely to stop cutting interest rates, which is favorable for the zloty. The zloty has advanced 19 percent since February when it bottomed out to the lowest level since the country joined the European Union, and being Germany the main trading partner of the Polish nation, yesterday news impacted investors in Warsaw heavily, pushing stocks and the national currency up.

Poland is likely to benefit intensively from the Eurozone economic recovery among the eastern EU members, since its tax cut policy made them able to be the only country in the region to dodge recession in the first quarter. The influence of German economic figures is extremely high in Poland, not only for being the nation’s main trading partner, but also for being the wealthiest and most dynamic economy in the European Union.

EUR/PLN traded at 4.1200 as of 9:51 GMT from a previous close yesterday at 4.1340.

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