The zloty strengthened the most in seven weeks after a report showed Poland’s economy grew at the fastest pace in two years last quarter.
The zloty slid for a second day while yields on Poland’s five-year notes dropped to a record on speculation the central bank will signal tomorrow it plans to cut interest rates.
The zloty rallied and bond prices fell as Poland’s central bank unexpectedly left interest rates unchanged after the slowest economic growth in almost three years.
Poland’s central bank Governor Marek Belka is keeping mum about the future path of interest rates, seeking to prevent traders from prematurely betting on higher borrowing costs and squeezing the nascent economic recovery.
"Whenever the ruble declined strongly, the zloty also fell, but it has always been a short-term reaction."
- Rafal Benecki on Dec 16, 2014