USDPLN Forecast / Forex Technical Analysis

USDPLN Forecast – Poland Interest Rates Unchanged

FxNews—The currency pair has struggled to surpass the 23.6% support level in the daily chart. Notably, there are no bearish candlestick patterns, suggesting that the bulls might have an opportunity to overcome this obstacle.

USDPLN Forecast – Poland Interest Rates Unchanged – Daily Chart

For a more detailed analysis, let’s zoom into the 4-hour chart of USDPLN. Here, the pair is trading within a narrow, bullish flag. Presently, the price is hovering just below the channel’s median line, with the RSI indicator also nearing the middle. This positioning indicates that the pair may test the channel’s lower band.

USDPLN Forecast – Poland Interest Rates Unchanged – 4H Chart

Should the bears close and stabilize the price below this channel, the USDPLN downtrend will likely persist. In such a case, the price might fall to 3.97, subsequently approaching the 78.6% support level. Conversely, the 23.6% level represents a significant resistance for the bulls. The bulls need to break above this threshold to maintain a bullish bias.

Poland Interest Rates Unchanged

Bloomberg—In a decision that met market expectations, the National Bank of Poland maintained its benchmark reference rate at 5.75% for the third consecutive month. This decision in December reflects the central bank’s response to uncertainties in the fiscal and regulatory landscape, which emerged following the victory of a coalition of pro-European Union parties in the recent election.

Key Rates and Economic Indicators

Along with the benchmark rate, other crucial rates like the Lombard and deposit rates were kept stable at 6.25% and 5.25%, respectively. A notable aspect of Poland’s current economic climate is the inflation rate. The inflation rate eased to 6.5% in November, marking the lowest since September 2021. However, this rate remains significantly above the central bank’s 1.5-3.5% target range.

On the growth front, Poland’s economy showed a slight uptick, with a 0.5% year-on-year increase in the third quarter, recovering from a 0.6% contraction in the second quarter. This modest growth is a positive sign for the country’s economic resilience.

The Monetary Policy Council of the National Bank of Poland believes the current interest rate level is appropriate for achieving its medium-term inflation targets. It has indicated that future decisions on interest rates will be data-driven, considering emerging economic indicators.

Impact on the Economy

Maintaining the interest rate steady can be seen as a balanced approach to economic uncertainty. It suggests that the central bank is cautiously optimistic about the country’s economic recovery while being mindful of inflationary pressures. Steady rates can help stabilize the economy, but prolonged higher-than-target inflation could pose challenges for businesses and consumers.