Polish Zloty: Near-term EUR/PLN forecast raised to 4.30 – Commerzbank

Commerzbank's Tatha Ghose has increased the near-term EUR/PLN forecast from 4.20 to 4.30, taking into account recent global risk-off moves and uncertainty surrounding the oil price shock. The bank retains its end-2026 forecast at 4.25 and end-2027 forecast at 4.40, anticipating a steady rise in the EUR/PLN throughout 2027. The zloty is currently facing additional downside pressure due to heightened global risk aversion toward emerging markets and the uncertainty surrounding the oil price shock.

Despite this, the bank remains optimistic about the zloty's recovery, believing that the geopolitical situation will de-escalate, allowing the euro and eastern European currencies to stabilize, leading to the PLN's recovery from its current risk-driven weakness. This recovery could be facilitated by the timing of monetary policy, with the National Bank of Poland (NBP) potentially maintaining a hold on rates while oil prices and risk premia begin to fall, creating a favorable environment before expectations of rate cuts return.

In the medium-term, however, the zloty is expected to face more challenges due to political risks, maintaining a mild depreciating trajectory. The bank leaves its end-2026 and end-2027 forecasts unchanged at 4.25 and 4.40, respectively.