USD/PLN rate tried to break the support zone 3.74–3.755
Strongening of the yen, which accounts for about 14% of the basket that forms the dollar index (the market speculated about a possible intervention by the Bank of Japan) and lower-than-consensus monthly data on new jobs outside agriculture in the US, which cooled market expectations of the scale of Fed rate hikes, contributed on Thursday to a global depreciation of the USD.
The slight pullback of the market from Fed rate hike expectations initially improved global risk appetite, which also supported the zloty against the euro, but falling US equity indices ultimately neutralized this effect.
As a result of the indicated factors, the dollar index (DXY) tested important support slightly below 101 points, EURUSD tested the upper limit of the technical resistance zone 1.14–1.1460, and on the domestic market the USDPLN rate tried to break the support zone 3.74–3.7550.
Euro rate – forecast for the coming days
On Friday liquidity in global financial markets will be lower, as the US stock exchanges will be closed due to a holiday. Investors will therefore focus on June business‑cycle indicators from Europe, and assuming no significant differences from consensus, their impact on currency rates will likely be limited.
In the absence of geopolitical surprises, we assume that on Friday the main PLN pairs will not change significantly – EURPLN will move between 4.28 and 4.29, while USDPLN will be in the range 3.74–3.76.
In our view, only next week will answer whether the levels mentioned in the above paragraph – crucial for the direction of short‑term trends of the dollar index, EURUSD and USDPLN – will be maintained or overcome.
Government bonds – forecast for the coming weeks
On the interest rate market, Thursday's session brought a decline in the yields of Polish bonds, following the movement in the US Treasury market. The support for valuations was mainly the publication of US labor market data, which turned out to be clearly weaker than expected. Additionally, a positive impulse for bonds came during the European session from further declines in oil prices – Brent oil prices approached the 70 USD/bbl level.
In the near future we still see room for further decline in the yields of domestic bonds.
In the 2‑year sector they may move towards 3.95%, while in the 10‑year sector a drop below 5.20% is possible.
Macroeconomics
With an empty macroeconomic calendar on Friday, the market should move within the existing medium‑term trends. After the release of US labor market data, expectations for future Fed rate cuts have decreased, although the market still prices a 2026 rate cut of more than 25 basis points.
This approach may be partly justified by recent signals from the central bank and its representatives. Nevertheless, taking into account falling energy commodity prices, lower-than-expected June inflation readings in Europe, and the general global decline in inflation expectations, one can assume that the FOMC will eventually decide to soften its communication tone. A similar process began earlier with the ECB.
As a result, the market no longer fully prices a rate cut in the eurozone in 2026. If – according to our scenario – a similar shift in sentiment also occurs with the Fed, there will be significant room for a decline in US Treasury yields. Currently, the 10‑year UST yield is around 4.48%. In the 3q26 outlook we expect a clear decline towards 4.20%.
