CEE FX: Rate hike prospects – Societe Generale

Societe Generale anticipates a 25 basis point interest rate hike from the Czech National Bank (CNB) during their upcoming meeting. The bank's outlook is based on Czech GDP and wage growth falling short of August projections, while inflation has been higher than expected. Despite these factors, the CNB maintains a cautious approach to tightening monetary policy.

In contrast, Poland's National Bank (NBP) is expected to maintain its interest rate at 3.75%. The CNB is expected to keep a hawkish stance and consider further rate hikes if inflation pressures persist. The EUR/PLN exchange rate has recently reached the upper limit of a short-term range, with future projections around 4.44 and 4.48.

The support level of 4.3850, observed last week, could be significant. Meanwhile, the Australian dollar (AUD) has rebounded following positive news on Iran diplomacy, which has limited the influence of the safe-haven US Dollar. Meanwhile, the USD/JPY pair is showing gains after falling to a sub-157.00 level following the Bank of Japan's intervention.

Gold is experiencing a slight upward correction, trading near the October 2025 low. Gold's price is influenced by optimism over a potential diplomatic resolution to the US-Iran war, while the US Federal Reserve remains committed to further rate hikes amid energy-driven inflation concerns. Dogecoin continues to struggle, hovering around $0.075 after declining for five consecutive weeks since the end of September.

Analysts see conflicting trends in whale activity, with some reducing their holdings while others accumulate tokens. On-chain metrics and technical indicators are signaling potential further losses for DOGE. In the US economy, growth has been modest at 3.4% annually, yet Treasury yields have declined, and the Nasdaq ended October with its worst monthly performance since March 2025.

This suggests that investors are now scrutinizing whether capital expenditure is generating sufficient cash flow and returns beyond the cost of capital.