The Middle East remains without a breakthrough
Tehran maintains a hard stance on the blockade of the Strait of Hormuz, Bloomberg reported.
Iranian authorities declared that they will not join further rounds of talks with the United States if Washington continues actions affecting the throughput of the transport corridor.
The temporary restoration of traffic in the strait coincided with the announcement of new talks, which Donald Trump informed about, indicating a planned meeting in the capital of Pakistan, Islamabad.
In a conversation with FXMAG, Michał Stajniak, deputy director of the XTB Analysis Department, explained the impact of current events on the currency market.
"The dollar‑to‑zloty rate is a pure indicator of risk appetite", he said.
In the event of a de‑escalation, further declines are possible against the continuation of dollar sell‑off and erosion of the dollar as a global reserve currency.
Conversely, if a total escalation of the conflict occurs, USD/PLN has chances to rise to the level of 3,80, and in the case of a complete economic collapse, even above 4 PLN.
The expert emphasized that both Washington and Tehran could discreetly pursue a resolution to the conflict in the Middle East, although achieving consensus will be "very difficult".
"The EUR/USD pair will behave very similarly. De‑escalation could bring the pair back to around 1,20, especially if the ECB still considers raising interest rates in such a situation," he added.
Michał Stajniak also defined the risk level from the blockade of the Strait of Hormuz, which since the U.S. and Israel attack on Iran has become one of the key elements of the geopolitical negotiation game.
The U.S. blockade of the Strait of Hormuz is quite a hard playing condition, but at the same time it does not lead to further escalation of attacks. Nevertheless, further blockade from either side, without positive negotiations, can lead to sharp responses, even in the form of attacks on tankers, which would be a potential breach of the final red lines.
The United States has not decided on a land invasion for 1.5 months, so such a solution seems currently unlikely, but still potentially possible—Michał Stajniak summarized.
Read also: The dollar rate before a breakout chance? Expert: "Capital will flow back to USD"
Also see: The dollar rate down, euro up? The market expects a breakthrough. "No scenario can be ruled out," the expert says
Dollar and euro rates on Monday, April 20
The dollar‑to‑zloty rate on Monday, April 20 is at 3,60 PLN.
Chart. Dollar‑to‑zloty rate (USD/PLN)
Source: TradingView.
The euro‑to‑dollar rate reaches 1,17 USD.
Chart. Euro‑to‑dollar rate (EUR/USD)
Source: TradingView.
Read also: The dollar rate on a long road to 4 PLN? Expert issued forecasts for USD/PLN and EUR/USD. "The dollar may gain"
Also see: The dollar rate before a "nervous and dynamic" move, euro waiting for a drop? Expert issued a forecast for USD/PLN and EUR/USD
