EUR/PLN likely to trade around 4.30 by end-2017, says Lloyds Bank

The Polish zloty strengthened against the euro in the past month, coinciding with above-expected March data from Poland. The EUR/PLN dropped from a high of 4.45 at the beginning of the year to 4.19, the lowest level since September 2015. The central bank of Poland is still committed to keeping the interest rates on hold until 2019. However, there is a possibility for a change to a more hawkish bias, noted Lloyds Bank in a research report.

Still, most upward revisions to the economic growth projections have depended on stronger investment activity. This might be elusive as increased political risk might hurt future investment intentions. However, the risk to investment have been eased by the recent rebound in industrial production. According to Lloyds Bank, the EUR/PLN is expected to trade at around 4.30 by the end of this year.