Bloomberg News

Zloty Slides as Polish Central Bank Cuts Rates for Fourth Month

February 06, 2013

The zloty weakened after Poland’s central bank cut borrowing costs for a fourth month to boost flagging economic growth.

Policy makers reduced the main interest rate by a quarter- point to 3.75 percent, matching the forecasts of all 34 economists in a Bloomberg survey, after the slowest pace of economic expansion since 2009 prompted the government to call for more monetary stimulus. Governor Marek Belka holds a news conference to explain the decision at 4 p.m. in Warsaw.

“We assume that the central bank will keep the door open for further rate cuts,” Thu Lan Nguyen, an analyst at Commerzbank AG in Frankfurt, said in an e-mailed report. “Should Belka signal that there might be an imminent rate pause to allow the central bank to assess the effect of previous rate cuts, that may support the zloty slightly.”

The zloty declined 0.3 percent to 4.1869 per euro as of 1:38 p.m. in Warsaw. It extended this year’s drop to 2.5 percent, the steepest after the South African rand among nine currencies of eastern Europe and Africa tracked by Bloomberg.

To contact the reporter on this story: Piotr Skolimowski in Warsaw at pskolimowski@bloomberg.net

To contact the editor responsible for this story: Wojciech Moskwa at wmoskwa@bloomberg.net


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