U.S. Secretary of State M. Rubio said on Tuesday that an agreement with Iran is still possible. National swap rates for the main tenors touched the upward trend line set by the troughs recorded since mid‑April and early March, indicating potential for a modest rise in today's session. Data from the Statistical Bulletin will have limited impact on the market, and a weaker May Conference Board reading could dampen dollar strength and push yields lower.
>> Also see: The dollar rate may get new fuel for gains. The Middle East hits USD/PLN and EUR/USD
Euro EUR/PLN down, zloty gains
The EURUSD rate, after falling in the Asian session, opens the session with a slight rise around 1.163.
In the domestic equity market, gains of about 0.8‑2% prevailed. The zloty gradually gained value from about 4.237 to about 4.23. The zloty was not hurt by weaker‑than‑expected retail sales data for April (1.3% year‑over‑year).
Decline in Polish bond yields
In the domestic interest rate market, market rates fell by about 5 basis points at the open, and later in the day IRS rates remained stable until the end of the session. A similar situation occurred in the debt market, where bond yields fell by about 10‑12 basis points at the start of the session. At the end of the day, the yield on 10‑year bonds was about 5.78%.
According to estimates from the Ministry of Finance, the gross borrowing needs for 2026 under the budget law are currently about 54%. The Ministry of Finance announced that it will offer 27 May bonds with a total value of 7‑11 billion PLN in series: OK0129, NZ0331, PS0731, DS1033, DS0436 and NZ0936 for sale.
BGK also announced that it plans to supplement its standard FPC securities offering with a series of floating‑rate securities based on the POLSTR index; these bonds should appear in standard auctions already in Q3 2026. In addition, BGK plans to introduce swap auctions as part of FPC fund management.
Green on European exchanges
Activity in international markets was limited due to the National Memorial Day in the USA and the spring banking holiday.
On European trading floors, the green color dominated, and equity indices rose by up to 2%.
Since Friday, market sentiment improved with rising expectations for an agreement between Iran and the USA.
Iran, however, reported during the day that it is not close to signing an agreement, despite agreement on many issues.
The main goal of the talks remains ending the war on all fronts, including in Lebanon.
The EURUSD rate oscillated in a narrow range of 1.163‑1.165 and ended the day close to opening levels around 1.164.
Oil prices fell during the day to about $98 from about $99.
Yields in the German market opened with a large gap, below Friday's close by about 5 basis points, and fell further by an additional 5 basis points during the day. In contrast, in the U.S. market, yields initially fell by about 5 basis points, but later in the day rose again near the opening level.
At the end of the session, 10‑year Bund and Treasury yields were around 2.93% and 4.55%.
