Currency Crunch: Predicting the Zloty’s Future as of 16.01.2024

By Gustavo Nils Jan16,2024

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The Zloty is likely to experience significant turbulence given the current political crisis in Poland. The situation arose as the Law and Justice party, having lost the elections, is reluctant to relinquish power, prompting widespread demonstrations. Furthermore, their actions jeopardize access to €60 billion in European Union funding. In light of this, USDPLN is expected to be directly affected.

Looking back, the recent political discord resulted in a substantial increase in USDPLN rates. Conversely, the victory of Donald Tusk’s party in the recent elections had previously boosted the value of the Polish zloty. However, with the resurgence of political instability, the zloty faces challenging times. This is compounded by an overall reevaluation in global markets concerning the monetary policies of central banks.

Despite being a significant outperformer in 2023, the current state of the zloty is precarious. The latest approach by the Narodowy Bank Polski hinted at a possible adjustment in interest rates, making the future uncertain. Given these scenarios, the immediate future for USDPLN is for short-term trading towards 4.055 and 4.09-4.11, followed by a potential rebound and a shift to medium-term short trades.

*Disclaimer: The content above represents the individual opinion of the author and should not be treated as official advice.

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