Thursday did not bring fundamental changes to the currency market. The dollar's weakness continues. The zloty is supported by trade data.
Next positive stimulus for the zloty
According to the National Bank of Poland, the current account showed a surplus of 2.842 million EUR in June, while the balance of trade (the difference between exports and imports) was 2.666 million EUR. In both cases, these are results clearly above the market consensus - by 0.623 million and 1.456 million EUR, respectively, and both are the highest levels since at least 2004.
Poland's trade data for June may not be important for the market in the current conditions, but they fit well with the positive story built in recent weeks for the zloty, which is supported by both external and internal factors.
In the afternoon, the zloty gained against most currencies, while also remaining one of the strongest currencies of emerging countries. The scale of growth, however, fell slightly about an hour and a half after the start of trading on the New York Stock Exchange, which, together with the increased activity of American investors, resulted in the dollar paring losses. However, these changes have been minor, and the US currency remains close to its lowest level in two years. The EUR/USD exchange rate moved away from today's highs of around 1.1865 to 1.1820 in the afternoon.
The USD/PLN exchange rate also moved away from today's lows of about 3.707, rising back closer to 3.72 in the afternoon. The EUR/PLN continues to move within a narrow range of 4.395-4.40 today, but if we look at it a little wider, it is already close to the lower volatility limit since the last day of May, despite the globally strong euro.
By the end of the day, it is unlikely that there will be any significant changes in the foreign exchange market, due to the practically empty calendar of macroeconomic events. However, we can expect an increase in volatility on Friday, when we will see a set of data from China in the early morning and from the US in the afternoon.
The market will probably attach the greatest importance to data on retail sales (China, USA) and consumer confidence (USA), which may indicate how demand is developing in the largest economies in the world, on which the return to pre-pandemic conditions depends most.