The National Bank of Poland has shifted to a more cautious policy stance after recent currency weakness and inflation surprises forced a rhetorical retreat. NBP Governor Adam Glapinski used G20 commentary to adopt neutral, flexible language, stepping back from previous dovish signals that suggested rate cuts were approaching. The pivot follows a hawkish surprise in August consumer price inflation data and notable underperformance of the Polish Zloty against regional Central European peers.
Commerzbank analyst Tatha Ghose suggests the central bank now appears on the defensive, caught between earlier rate cut expectations and emerging market realities. The Zloty’s weakness relative to Czech and Hungarian currencies has complicated the policy outlook, forcing policymakers to recalibrate their messaging. Traders holding Zloty positions face renewed uncertainty as the previously telegraphed easing cycle now looks less certain.
FXnCO Insight
Polish rate cut expectations should be scaled back near-term, creating potential short-term support for Zloty positioning against CE3 crosses as dovish trades unwind.
Source: FXStreet