Bloomberg News

Polish Yields Rise as Retail Sales Data Beats Estimates

February 25, 2013

Yields on Poland’s two-year bonds increased to the highest since November after higher-than- estimated retail sales reduced the chances of further interest rate cuts from the central bank.

Yields on the notes due July 2015 rose six basis points to 3.487 percent after January retail sales increased 3.1 percent from a year earlier, according to a report from the statistics office in Warsaw today. That beat a median estimate for a 0.7 percent increase in a Bloomberg survey of economists.

“The data somewhat strengthens the power of arguments of those on the Monetary Policy Council that want to end the rate- cutting cycle,” Bank Pekao SA (PEO)’s economists wrote in a note after the report.

The central bank has cut rates for four straight months to 3.75 percent since November. Investors are betting on one more interest-rate cut in the next nine months, according to forward- rate agreements compiled by Bloomberg.

The zloty gained 0.3 percent to 4.1469 per euro as of 4:56 p.m. in Warsaw.

To contact the reporter on this story: Maciej Onoszko in Warsaw at monoszko@bloomberg.net

To contact the editor responsible for this story: David McQuaid at dmcquaid1@bloomberg.net


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