The zloty rose to a one-month high as Greece’s agreement on a bailout eased concern over the country’s imminent departure from the euro area, Poland’s biggest trading partner.
The zloty climbed 0.8 percent to 4.1439 versus Europe’s common currency at 4:11 p.m. in Warsaw. The currency strengthened 2.3 percent in three days, the second best performance after Brazil among 24 emerging-market peers tracked by Bloomberg. Speculation over Greece’s potential exit from the euro and a slump in Chinese equities sent the zloty to a five-month low last week.
Greek Prime Minister Alexis Tsipras surrendered to European demands for further austerity to qualify for up to 86 billion euros ($96 billion) of aid he needs to keep his country in the euro. Optimism sparked by the deal will further support the zloty this week, while economic data will keep the currency volatile, Credit Agricole Bank Polska SA economists led by Jakub Borowski wrote in a note on Monday.
“Momentum may strengthen the zloty a bit more, but there’s little chance for a giant move,” Przemyslaw Kwiecien, the Warsaw-based chief economist at X-Trade Brokers Dom Maklerski SA in Poland, said by phone. “I wouldn’t be euphoric as we’re still very far away from getting things fully sorted out.”
Poland is scheduled to report May current-account data on Tuesday and June inflation on Wednesday. Last month’s wage growth numbers will be published on Thursday, followed by industrial output and retail sales on Friday.
The yield on Poland’s 10-year zloty government bond rose three basis points to 3.07 percent, 28 basis points below a 10-month high reached on June 29. The spread over similar German bonds added four basis points to 219 basis points, climbing from a two-month low.
Chinese shares climbed for a third day after unprecedented government intervention to end a rout that wiped out almost $4 trillion of value.
“The global situation may be more important than local macro publications, given that the elevated volatility last week was not caused only by the situation in Greece, but also, or above all, by developments on the Chinese stock market,” Bank Zachodni WBK SA economists led by Maciej Reluga, wrote in a research note today.