POLAND: Wibor Rates

A European Commission spokesman has confirmed that Commission President Ursula von der Leyen and EU High Representative for Foreign Affairs and Security Josep Borrell will both travel to Kyiv this week to hold talks with Ukrainian President Volodymyr Zelensky.

• Comes just days after European Parliament President Roberta Metsola also traveled to the Ukrainian capital for talks with the president.
• Visit is not a major surprise, given Slovenian PM Janesz Jansa (who previously visited Kyiv during the war alongside his Polish and Czech counterparts) tweeted last night about the possibility VdL and Borrell could travel there.
• Zelensky will be hoping to convince the EU leaders to push member states to up provisions of lethal aid to Ukrainian forces and to cut off supplies of Russian hydrocarbons to the West. The latter request likely to fall on deaf ears given member state objections.

• The RBA's hawkish policy hold overnight continues to push AUD to the top of the G10 table, with AUD gains most notable against NOK, JPY and EUR so far today.
• The move puts EUR/AUD through horizontal support drawn off the mid-2017 lows at 1.4424, with prices now at the lowest levels since late April 2017 - narrowing the proximity with the 2017 cyclical low of 1.3627.
• Policy expectations remain the key driver for AUD at this juncture, shrugging off the previously-held correlation with market volatility and allowing AUD to look through near-term geopolitical risk emanating from the Ukraine crisis (see: https://marketnews.com/cautious-rba-could-work-aga... ).
• The overnight price action has tipped the EUR/AUD RSI into oversold territory for the third time in 2022. The previous two occasions prompted a corrective recovery in the cross, followed by a resumption of the longer-term downtrend once the oversold condition was cleared.
• Sell-side analysts remain bullish on AUD. On March 10th, CIBC cited long AUD as their highest conviction view, with the commodity prices, Australian inflation expectations and a leaning hawkish RBA working in the currency's favour.

Figure 1: EUR/AUD vs. RSI

Source: MNI/BBG