Adam Narczewski, X-Trade Brokers Dom Maklerski SA

The złoty extended the run it had been on since the beginning of the year, appreciating at its fastest rate so far last week. Moreover, the market doesn’t seem to be giving any signals that a corrective movement is in store. Macroeconomic news from the US (ISM index and labor market data) and the euro zone (PMI reports) show improvement in the economy.

Lower risk aversion and climbing stock markets are helping the złoty. The Polish currency ended another week gaining against the majors, with the EUR/PLN falling to zł.4.17 (a five-month low), USD/PLN to zł.3.19 (a three-month low) and the CHF/PLN to zł.3.46 (a four-month low). However, the risk of a corrective movement increases as long as the euro-zone debt crisis remains unsolved. Also, a stronger złoty means that the chance for an interest-rate hike diminishes, and if members of Poland’s Monetary Policy Council continue to make rather hawkish statements, a corrective movement will become a certainty.

The złoty is one of the top-10 best performing currencies in the world so far this year, appreciating almost 8 percent against the US dollar. On top of the list is the Hungarian forint (up 9.5 percent against the US dollar), surprisingly climbing despite the negative atmosphere around the policies of the Hungarian government.