PLN: Zloty Ticks Higher Ahead Of NBP Presser

EUR/PLN last deals at 4.2629, a tad lower on the session, with market participants looking ahead to the press conference with Governor Adam Glapinski (14:00GMT/15:00CET). From a technical perspective, the 4.25 figure is the initial line in the sand. Despite several attempts, the pair has failed to close below there in recent months. On the flip side, the focus is on the 50-EMA, which intersects at 4.2801.

• The central bank published a relatively hawkish statement in support of the expected on-hold rate decision yesterday, with analysts taking note of the removal of certain references to disinflationary factors. Specifically, the Council erased the earlier comment that "demand and cost pressures in the Polish economy remain relatively low, which amidst weakened economic conditions and lower inflation pressure abroad curbs domestic inflation pressure. The earlier appreciation of the zloty exchange rate acts in the same direction."
• This comes after the Governor's surprising hawkish pivot at the December press conference, which was later questioned by several of his colleagues. In the light of yesterday's statement, most analysts expect the Governor to stick to his earlier stance.
• POLGB yields remain elevated, with 5s underperforming as we type. FRA contracts have edged higher.
• The WIG20 Index has added 0.8% so far.