The biggest mover in the FX market at the start of this week has been the Polish Zloty. Economists at MUFG Bank analyze PLN outlook after the favourable election outcome over the weekend in Poland.
Poland’s relations with the EU set to improve providing boost for Zloty
According to exit polling, and a partial vote count, the opposition parties are on course to win back power and deny the ruling nationalists a third term in what is the best case scenario for financial markets.
The main opposition party, the Civic Platform, has reportedly won 31% of the vote according to a projection from Ipsos which along with the Third Way alliance winning 14% of the vote, and the Left party winning 8.6% of the vote will give the opposition parties a majority of 248 seats in the 460 seats lower house of parliament.
The ousting of the nationalists will help to restore damaged relations with the EU. The Civic Platform is led by Donald Tusk who was the former European Council President.
The Zloty should continue to strengthen further in the near-term in anticipation of improving relations with the EU that will help to support growth and attract capital inflows.
